Canada: Mood on growth prospects has improved - Westpac

Richard Franulovich, Research Analyst at Westpac, notes that the “mood” on Canadian growth prospects has improved in recent weeks, aided by solid jobs, PMIs and housing data in recent days.

Key Quotes

“Both yield spreads and oil prices have broadly been trending in favour of a lower USD/CAD in recent weeks too.”

“A genuine floor for Canada’s terms of trade thanks to the OPEC/non-OPEC deal and the Trudeau’s fiscal spending plans leave 2017 growth risks tilted to the upside.”

“USD/CAD probably holds above 1.3000, but CAD can see more sustained gains in coming weeks on key crosses, notably vs EUR and JPY.”