Crude prices are holding onto gains from late Wednesday, setting a
risk-on tone across markets, as OPEC ministers have signalled a likely
production cut at their next official meeting on 30 November...USDCAD
failed to sustain a break of its 200-day moving average on the topside
for a second day in a row Wednesday and retreated below 1.31 as oil
prices gained. We think USD vulnerability is likely to see USDCAD trade down towards 1.30 in the near-term.
We think GBP is likely to weaken over the coming weeks.
Our short-term fair value model BNP Paribas STEER continues to
highlight that the currency actually looks expensive versus rates and
equities. Short-term fair value for Cable is below 1.29 at 1.2887 and for EURGBP it stands at 0.8695.
Market expectations for Bank of England easing continues to look too
conservative in our view, with our 5bp of rates cuts priced for the
November meeting versus our economists’ expectations for a 15bp cut.
USD/CAD today’s Exchange Rate is 1.3547.
USD/CAD is going down and is recommended to sell.
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