CAD seen higher medium term – Danske Bank

Pablo Piovano FXStreet

Analyst Kristoffer Lomholt at Danske Bank sees the Canadian currency appreciating further in the medium term.

Key Quotes

“As widely expected, the Bank of Canada kept the policy rate unchanged at 0.5% at the September meeting. Surprisingly, the BoC twisted its language on the balance of risk for inflation from ‘roughly balanced’ (in July) to ‘tilted somewhat to the downside’. We – alongside markets – still expect BoC to leave rates unchanged for the next 12M”.

“Near-term a stronger USD and a setback in oil prices could send the cross temporarily higher. In the medium- to longer run we still expect the fundamentally undervalued ‘loonie’ to appreciate gradually on the back of valuation and a gradually higher oil price”.

“We lift our USD/CAD forecasts to 1.33 in 1M (from 1.32) and 1.31 in 3M (1.30). We leave the 6M and 12M projections unchanged”.

1 Week
1 Month
1 Quarter

1 Week

Avg Forecast 1.3078

0% Bullish
100% Bearish
0% Sideways

Bias Bearish

1 Month

Avg Forecast 1.3153

44% Bullish
44% Bearish
11% Sideways

Bias Neutral

1 Quarter

Avg Forecast 1.3236

55% Bullish
27% Bearish
18% Sideways

Bias Bullish

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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