USD/CAD: More consolidation - Westpac
Richard Franulovich, head of FX strategy at Westpac, suggests that the USD/CAD’s sharp New Year decline has given way to a more consolidative picture and the 1.31-1.33 operational range is in play at the moment.
Key Quotes
“The bigger picture narrative underscores ongoing downside potential for USD/CAD into 2019. Crude oil is in a mild uptrend, a patient and flexible Fed is on hold through to mid-2019 while the BoC has an ongoing, albeit watered down and data-dependent tightening bias.”
“Markets continue to adopt a fairly relaxed stance on the potential BoC hikes in 2019.”
“USD/CAD a sell into strength and likely to outperform its dollar bloc cousins AUD and NZD, the BoC’s tightening bias a stark contrast to both the RBA and the RBNZ’s more balanced approach that explicitly includes the possibility of rate cuts.”
Author
Sandeep Kanihama
FXStreet Contributor
Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.
