6 May 2015
USD/CAD 6M forecast at 1.23 – Rabobank
FXStreet (Barcelona) - Expecting Fed to hike rates in December, Jane Foley, Senior Currency Strategist at Rabobank, now forecasts USD/CAD at 1.23 in 6 months and 1.25 in 9 months.
Key Quotes
“The market has inferred that the BoC is not positioning itself to follow its January ‘insurance’ interest rate cuts. This conclusion has added further support to the CAD. Together with the recent broad-based sell off in the greenback, the value of USD/CAD has plunged over 6% from its mid-March high.”
“Canadian trade data for March highlighted a widening in the deficit to a record C$3 bln led by a slump in energy exports. These data should hamper further upside potential for the CAD although the outlook will remain dominated by oil prices.”
“On the basis that we expect the Fed to hike rates in December this year, we expect USD/CAD will push higher again in the months ahead. That said, we have pared back our 6 mth USD/CAD forecast to 1.23 and 1.25 in 9 mths.”
Key Quotes
“The market has inferred that the BoC is not positioning itself to follow its January ‘insurance’ interest rate cuts. This conclusion has added further support to the CAD. Together with the recent broad-based sell off in the greenback, the value of USD/CAD has plunged over 6% from its mid-March high.”
“Canadian trade data for March highlighted a widening in the deficit to a record C$3 bln led by a slump in energy exports. These data should hamper further upside potential for the CAD although the outlook will remain dominated by oil prices.”
“On the basis that we expect the Fed to hike rates in December this year, we expect USD/CAD will push higher again in the months ahead. That said, we have pared back our 6 mth USD/CAD forecast to 1.23 and 1.25 in 9 mths.”