Senior Analyst at Danske Bank Kristoffer Lomholt sees the pair slipping back to the 1.3200 area within a month’s time.
“Over the past month, USD/CAD has been hit by both a repricing of Fed monetary policy and the oil price falling. Meanwhile, the domestic outlook has improved further, which has left rates markets still pricing in close to a full rate hike over the coming year. However, we are a little more cautious on the rate hike outlook and instead emphasise valuation and recovering oil industries as a gravitating force on the cross”.
“We forecast USD/CAD at 1.32 in 1M (unchanged), 1.31 in 3M (from 1.32), 1.30 in 6M (unchanged) and 1.28 in 12M (unchanged)”.