http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/http://www.fxstreet.com/fundamental/http://mediaserver.fxstreet.com/images/fxstreet-provider-logo1-en.gif7http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2012-02-02.htmlBy announcing that it was inclined to keep interest rates low until late 2014, the Federal Reserve prompted us to push the first Fed rate hike to 2014, and as a result we’ve raised our end-of-2013 targets for dollar crosses. While the Fed’s announcement reinforced the long-term depreciating trend of the US dollar that won’t preclude bouts of US$ strength, particularly with the euro’s ongoing problems. The recently announced European fiscal compact, while a step in the right direction in termsThu, 02 Feb 2012 14:13:33 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2012-02-02.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2012-01-11.htmlThe euro is increasingly looking like a deadbeat currency, pinned under the weight of a sovereign debt crisis and inadequate policy response. The eurozone recession, which arguably started in Q4 last year, isn’t helping. But then again, a downturn was inevitable given the ill-timed austerity measures in some countries. While we remain bearish on the common currency, we won’t rule out a temporary surge over the near term. A soon-to-be unveiled Franco-German blueprint for a eurozone fiscal unionWed, 11 Jan 2012 16:32:42 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2012-01-11.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-12-07.htmlThe euro’s demise is more than just a mere possibility, particularly if the common currency’s main flaw, the lack of fiscal integration, isn’t addressed. But a fiscal union will take years to develop. Short-term solutions are required at this point.ECB-enabled IMF purchases of government bonds may be designed to circumvent the limitations brought by the European Treaty but that action alone is unlikely to stem the crisis. Eurobonds may be the solution, but so far have been rejected by theWed, 07 Dec 2011 09:12:24 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-12-07.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-10-04.htmlThe probability of an OECD recession has increased significantly. The weak economic outlook and political uncertainty on both sides of the Atlantic should continue to feed risk aversion and support safe haven currencieslike the US dollar and the Japanese yen. Longer term, there is a weakening bias for the greenback as the global imbalance problems are addressed.   The Canadian dollar’s dependency on capital inflows leaves it vulnerable to bouts of risk aversion, and we therefore expectTue, 04 Oct 2011 15:33:39 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-10-04.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-09-02.htmlDebt crises in Europe and the US have clearly weighed on confidence globally and the harsh fiscal austerity measures of governments in the OECD could produce further headwinds worldwide, benefiting the US dollar in the process. The euro, which has held firm despite a string of weak economic data has downside, particularly as sovereign debt problems, fiscal tightening and a likely looser monetary policy by the ECB eventually catch up to the common currency. Canada, though enjoying relativelyFri, 02 Sep 2011 20:26:50 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-09-02.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-07-08.htmlLacklustre job creation, a slew of negative economic surprises and uncertainty about euro zone sovereign debt crises have created ideal conditions for a USD rally. Since June 29th, however, the CAD has strengthened on renewed optimism about Europe. Up to now, Bank of Canada governor Mark Carney seems more concerned about the effect that headwinds from a strong Canadian dollar and the U.S. economic soft patch might have on Canadian growth than about developments on the inflation front. WithFri, 08 Jul 2011 06:41:28 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-07-08.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-05-05.htmlThe United States has plenty of leeway available before seeing its “AAA” sovereign debt downgraded. Given the margin of manoeuvre that exists in terms of taxation, a credible budget plan could eliminate most of the existing structural deficit. In such a context, a disorderly depreciation of the U.S. dollar is not the most likely of scenarios to our eyes. As the financial markets are already anticipating a series of rate hikes from the ECB, the impact of European monetary policy on the euroThu, 05 May 2011 20:38:11 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-05-05.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-04-06.htmlMessage from ECB well-nigh unequivocal European inflation has already reached 2.6% and current European monetary policy is still much more accommodative than at the height of the financial crisis. In this context, the ECB’s message recently was unequivocal. The European key rate will likely be raised as early as in April, well ahead of any action by the Federal Reserve. The euro should peak in Q2, therefore, as the markets have already incorporated a good number of rate hikes in Europe. On theWed, 06 Apr 2011 18:50:46 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-04-06.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-03-04.htmlThe divergence in monetary policy expectations over the next 12 months widened even further between Europe and the United States in favour of the euro. The markets are now convinced that the ECB will begin to rebalance monetary policy ahead of the Fed. The loonie reacted strongly to Canadian growth of 3.3% in Q4, topping US$1.03 as it tested its wings at higher altitudes. What the latest Canadian real GDP data tell us is that the loonie’s appreciation does not shut the door on a possibleFri, 04 Mar 2011 16:45:16 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-03-04.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-02-02.htmlAfter keeping the world on high alert for two months, the European debt crisis has cooled somewhat now that the foreign exchange markets have turned the spotlight on inflation threats the other side of the Atlantic. Fuelled by energy prices, total inflation has just exceeded the official target of the European Central Bank for the first time in two years. If the financial markets are right, the ECB is about to get the jump on the Fed. The inflation differential between Europe and the UnitedWed, 02 Feb 2011 15:41:43 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2011-02-02.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-12-06.htmlThe euro has just suffered a veritable shellacking against the U.S. dollar, which is again benefitting from a safe-haven effect. After Greece in the spring, it is now Ireland’s turn in the fall to shake the financial markets and cause international investors to turn away from assets denominated in European currencies. We believe that the euro’s reaction on the foreign exchange markets has been somewhat overblown. This new episode of European turbulence should cause less damage than lastMon, 06 Dec 2010 21:01:50 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-12-06.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-11-05.htmlThe Federal Reserve just announced the details of its second wave of quantitative easing: New amounts of money to the tune of $600 billion will be pumped into the economy over a relatively short period of time. However, the U.S. monetary authority did not take the bull by the horns as far as the size of the liquidity injection goes but clearly indicated that the door was open to further intervention if needed. Given the duality of its mandate, that is, minding both inflation and employment,Fri, 05 Nov 2010 22:36:57 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-11-05.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-10-18.htmlChina just registered its largest trade surplus in seven quarters and the yuan has appreciated only very little to date. As a result, the trade imbalances between the major economic blocs are growing even worse. The situation is irritating some U.S. politicians to no end and reviving the spectre of protectionism.  On account of the continued sluggishness of the labour market, the Federal Reserve seems prepared now to fire a second volley of quantitative easing measures, which would haveMon, 18 Oct 2010 19:45:29 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-10-18.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-09-07.htmlU.S. real GDP data revisions by the Bureau of Economic Analysis this past July 30 put a dent in our growth and monetary policy scenarios. The data revisions, which showed the U.S. economy running at an even lower capacity utilization rate than initially reported, converged with a soft job market to leave the financial markets feeling disenchanted about the possibility of an imminent interest rate hike in the United States. The euro should not trend up in any sustainable fashion over the mediumTue, 07 Sep 2010 17:27:28 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-09-07.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-07-21.htmlWithout warning, the forex market has in the span of only a few weeks gone from fearing that the euro zone might be dismantled to doubting whether the U.S. recovery was sustainable. Actually, in 2010Q2, the U.S. economy will probably register its strongest domestic demand growth since the end of 2005. Consequently, brandishing the spectre of a new U.S. economic downturn does not seem justified. Given that the euro’s recent appreciation does not rest on solid fundamentals but rather on a mereWed, 21 Jul 2010 20:31:04 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-07-21.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-06-16.htmlAs a result of the European crisis, 2-year interest rates have fallen drastically in the euro zone, to the point that they presently stand at a mere 50 basis points. What’s more, most market observers do not expect any rate hikes in Europe in 2010. Given that the bulk of the bad news has now been more or less incorporated in the markets, the euro could go through a period of relative calm in the short term, especially if the Fed sticks with its present discourse, which remains all and allWed, 16 Jun 2010 18:21:38 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-06-16.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-05-11.htmlA mere six months ago, with the budget deficit skyrocketing in the United States, the foreign exchange market looked to the euro as a possible alternative to the U.S. dollar. Today, it is turning its gaze away and shaking its head. The European-IMF 750-billion-euro bailout package unfortunately failed to give the European currency a second wind. Instead, the euro has accelerated its downslide. On account of three factors identified in this month’s Forex, namely, the euro zone’s fundamentalTue, 11 May 2010 19:42:07 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-05-11.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-04-14.htmlRecent data out of China show without a doubt that the economy is racing along at such a clip as to stir up inflation factors. Consequently, China will have no choice but to revaluate its currency 5% to 10% in the medium term. The loonie is back at par with the greenback for the first time since 2008. Contrary to expectations, the Canadian dollar’s latest spurt has not paralyzed the economy, as the goods-producing sector is now outrunning the service sector. The Canadian short-term yield curveWed, 14 Apr 2010 19:07:57 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-04-14.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-02-02.htmlAs the U.S. economy tones up, the European currency should continue to depreciate for a simple reason: The trade-weighted euro is still by far the most over-valued currency relative to its purchasing power parity. It is hardly likely that the rate at which the Hong Kong dollar (HKD) is presently fixed will be re-evaluated in the very short term. In the mid-term, however, the financial markets appear to us overly complacent in giving the HKD 0% probability of appreciation over 24 months. TheTue, 02 Feb 2010 08:23:54 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2010-02-02.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-12-17.htmlThe November U.S. employment report was much more robust than expected. As a result, the cyclical forces of the U.S. economy are beginning to gain the upper hand on currency market operations based strictly on risk aversion. The shift in fundamentals should continue as the U.S. labour market is likely to surprise again going forward. In this context, the euro should depreciate considerably against the greenback over the coming quarters. Since the U.S. dollar began toning up, the loonie hasThu, 17 Dec 2009 11:47:56 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-12-17.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-11-05.htmlOn the basis of purchasing power parity, the euro and the yen, the two most important currencies next to the U.S. dollar, are more than 20% over-valued against the greenback. The financial markets have not budged much in recent months with respect to the Fed’s monetary policy. However, we are of the opinion that the foreign exchange markets have begun to fear a change in the Federal Reserve’s tone. This, combined with the negative medium-term factor of a strong over-valuation, leads us toThu, 05 Nov 2009 10:39:40 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-11-05.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-10-05.html• Our scenario calling for an appreciating USD is not unfounded. For one, labour productivity is taking giant steps forward in the United States while it is backpedalling in the euro zone. • The euro zone faces a double threat in that it must cope with negative productivity growth together with a loss of competitiveness resulting from the past appreciation of its currency. This is why we are reiterating our scenario calling for a depreciation of the euro over the coming quarters. • Two-yearMon, 05 Oct 2009 14:49:18 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-10-05.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-08-31.htmlAfter some 20 months of downturn, there is at last a light on the horizon for the United States and confirmation that economic recovery is under way. With the end of the financial crisis near, we believe the financial markets will soon cease to trade the USD as a function of risk aversion or appetite and get back to basics, focusing on the cyclical backdrop to the U.S. economy. The keystone of our currency scenario is an imminent return to job creation in the United States, which will forceMon, 31 Aug 2009 16:24:40 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-08-31.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-08-12.htmlEquity Watch One of the factors that propelled the markets over the past few weeks is strong earnings surprises. In the current earnings season, companies announced earnings results that were 10.9% above expectations in the U.S. and 8.9% in Canada. These positive surprises are leading analysts to increase their outlook. Over the past three months, the 12- month forward earnings have been revised upward by 1.5% in the U.S. This is the most positive revisions since 2005. In Canada, revisions areWed, 12 Aug 2009 16:48:33 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-08-12.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-07-13.htmlThe last thing the euro zone needs is an appreciating currency. As a result of the reversal of the safe-haven effect on the greenback begun a few months back, the euro remains over-valued in trade-weighted terms. In addition to Ireland having its credit rating downgraded recently by Standard & Poor’s, the ECB’s firepower is petering out again: Money-supply growth in Europe has just reached a 12-year low. Given that the U.S. leading economic indicator is back in positive territory for theMon, 13 Jul 2009 09:20:19 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-07-13.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-06-09.htmlStandard & Poor’s downgrading of its credit rating outlook on the United Kingdom from stable to negative rattled the exchange markets and caused the fiscal sustainability of the principal advanced economies to be reassessed. Normally, the desynchronization of U.S. and European monetary policies will push the greenback to gain at least 10% on the euro over a period of one year. In the next 12 to 18 months, the positive cyclical forces of the greenback should dominate the negative structuralTue, 09 Jun 2009 08:54:13 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-06-09.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-05-05.html* We are sticking with our scenario in favour of a greenback rally. Through its multiple interventions, the Federal Reserve has managed to set the U.S. money supply on an uptrend. The same can’t be said for the ECB. While the M2 aggregate is skyrocketing in the United States, European money supply growth is slowing. * According to the IMF, the European banking system is exposed to more than $1000 billion in toxic assets. We remain convinced that the ECB will have no choice but to resort toTue, 05 May 2009 16:31:22 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-05-05.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-04-09.htmlThe Federal Reserve surprised the exchange market this past March 18 by announcing the aggressive injection of new liquidity in the economy, including the purchase of $300 billion of U.S. Treasuries. The news prompted the euro to react violently against the greenback. However, we are of the opinion that the greenback will resume its positive momentum against the euro. The European currency’s recent appreciation reflects the fact that the ECB still lags behind the other central banks. Indeed,Thu, 09 Apr 2009 06:23:05 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-04-09.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-03-05.html• Numerous observers have attributed to the yen the same safe-haven currency status as to the greenback in this global recession. However, the yen has now begun to lose some of its shine. • The yen broke away from the pack in recent months. The Japanese currency’s appreciation against many other Asian currencies has been nothing short of spectacular and reflects a meteoric rise in the real trade-weighted exchange rate. • Over the long run, exchange rates constitute factors that help regulateThu, 05 Mar 2009 10:39:15 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-03-05.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-02-19.html• With nearly all key rates in the world today at floor levels, monetary policies are likely to have less influence on exchange markets. This clears the stage for the greenback, which enjoys the status of safe-haven currency in times of global recession. • Both fundamental and circumstantial factors suggest that the greenback bull market remains intact. The U.S. trade deficit now stands at only 3.5% of GDP and the recent correction has picked up sharply. • With economic activity in JapanThu, 19 Feb 2009 11:33:34 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2009-02-19.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-11-11.htmlThe U.S. dollar continues its rise from the ashes, but the steepness of the ascent is such that we are seeing extremely acute movements in the foreign exchange market. Faced with a dramatic deterioration in the global economy, the principal central banks have decided to take the bull by the horns, enacting a flurry of policy rate reductions. Of these monetary authorities, though, the ECB is the one that has done the least so far with cuts amounting to no more than 100 basis points. As itTue, 11 Nov 2008 08:25:41 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-11-11.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-10-08.html• The spillover effects of the U.S. financial crisis call for concerted action from the world’s principal monetary authorities, including a key-rate cut by the ECB. Meanwhile, the U.S. dollar continues to appreciate despite the absence of monetary tightening expectations in the United States, thereby signalling the definitive end of the greenback bear market. • In today’s world economic slowdown, the Japanese yen constitutes a special case, as it is expected to appreciate in lockstep with theWed, 08 Oct 2008 15:45:58 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-10-08.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-09-09.html- The greenback's fundamentals are getting better. With world crude oil prices down and the U.S. consumer recession choking imports, a substantial improvement in the U.S. trade deficit is under way. - Moreover, the current world economic slowdown has created an environment propitious to the greenback. Indeed, as a safe-haven currency, the U.S. dollar has tended historically to gain in value from 5% to 15% in trade-weighted terms when the global economy nears a cyclical low. Consequently, weTue, 09 Sep 2008 08:07:29 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-09-09.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-08-12.html- After trading within a narrow range since the beginning of the year, the loonie has lost altitude, breaking through a key technical support level on its way down. - The world economy is losing steam, which means commodity prices will fall, taking the cyclical currencies down with them. Consequently, we are lowering our forecast for the loonie and now expect it to trade within USD 0.90-0.92 by the beginning of next year. - As most of the bad news regarding the U.S. economy has already beenTue, 12 Aug 2008 07:49:49 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-08-12.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-07-09.html• The latest move by the ECB has lifted the real key rate in Europe to +25 basis points against -200 in the United States. However, we do not believe that the European monetary authority will need to tweak the real rate any higher. The ECB has drifted a good distance away from real indicators and may be seriously jeopardizing growth in the process. • The current EUR/USD exchange rate has factored in an overly aggressive increase in European interest rates, which should work against the euro inWed, 09 Jul 2008 15:58:55 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-07-09.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-06-13.html• Unlike the financial markets, we doubt the Fed will tighten between now and early 2009. But rate rise or no, speculators and other traders will have taken note of the Fed’s intention to protect the exchange value of the U.S. dollar. • At this writing the Canadian dollar is trading below 98 cents US for the first time since early May. It has fallen four cents in just one month despite the soaring price of oil. • The U.S. downturn is making itself felt in Canada, which is headed for an excessFri, 13 Jun 2008 14:24:25 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-06-13.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-05-06.htmlThe downward trend in the U.S. dollar which started in February 2002 has now lasted for more than 73 months. Has the greenback bottomed out? Meanwhile, with U.S. inflation still fairly high, the Fed is aware of the risk of overshooting in rate cuts and signalled April 30 that it plans to stay on the sidelines for a while. So short-term cyclical factors will also tend to buoy the greenback against the euro. The Canadian economy, though apparently better off than the American, is slowing at aTue, 06 May 2008 12:47:05 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2008-05-06.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2007-06-22.htmlThe Canadian dollar surged to a 33-year high after stronger-thanexpected economic growth and a pick-up in inflation prompted the Bank of Canada to switch to a tightening bias. Even though long-term fundamentals remain positive for the loonie, the extent of its appreciation since the month of March leaves it poised for a period of consolidation. Brazil’s restructuring of recent years is paying dividends in economic lift. Credit upgrades, high interest rates and well-contained inflation suggestFri, 22 Jun 2007 10:45:45 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2007-06-22.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2007-05-02.htmlThe U.S. dollar came under siege in April from the difference between the U.S. economic outlook and the outlook for the rest of the world. Since we think this trend will continue for both cyclical and structural reasons, we are staying with our forecast of a 10% depreciation of the greenback in 2007. The expected narrowing of Canada - U.S. interest rates and strong demand for commodities in response to economic growth outside North America will provide further support to the Canadian dollar inWed, 02 May 2007 15:34:56 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2007-05-02.htmlhttp://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2007-04-04.htmlThough the Federal Reserve kept its policy rate unchanged in March, it dropped mention of a tightening bias from its statement and left no formal guidance on its future direction. This shift, in combination with Washington’s turn to a more protectionist attitude toward non-market economies, is likely to make the exchange market more volatile. The yen appreciated strongly against many currencies from late February through mid-March, mainly because of reversals of carry-trade positions. In ourWed, 04 Apr 2007 14:40:21 GMThttp://www.fxstreet.com/fundamental/analysis-reports/info@nbc.ca (National Bank of Canada)http://www.fxstreet.com/fundamental/analysis-reports/forex-currency-outlook/2007-04-04.html