CAD to take cues from hard data - Westpac
|A dearth of hard data over the coming week (after CPI) may see CAD buffeted between oil complex performance, post FOMC USD moves and possible trade disputes with a hardline US given the tensions building between US Boeing and Canada’s Bombardier, according to Tim Riddell, Research Analyst at Westpac.
Key Quotes
“Poloz’s speech and press conference will be keenly awaited after BoC removed 2015’s insurance easing and kept future meetings “live”. Although most data continue to show an improving economy, the recent miss in manufacturing orders was blamed on CAD strength. The sharp flip in leveraged positioning since May leaves CAD vulnerable to any hint of a policy pause from Poloz.”
“However, 25 Oct BoC reports should show upgrades to growth and potential for an early closure of the output gap. Consequently, any positioning-related weakening of CAD should be limited.”
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