USD/CAD set to nosedive towards the 1.1750 mark by end-2022 – BMO
The loonie is the top-performing currency this year. Economists at the Bank of Montreal expect the Canadian dollar to continue its appreciation and forecast the USD/CAD pair trading at 1.1750 by the end of the next year.
See – USD/CAD: The road to 1.20 is still open – NBF
BoC likely to raise rates before the Fed
“A fierce rally in commodity prices is helping the economy, likely turning the Q1 current account into surplus for the first time since 2008.”
“While oil prices appear to have steadied near pre-virus levels and close to long-term norms in real terms, that's not the case for most of the other key resources that Canada sells abroad. The Bank of Canada's ex-energy commodity price index has shot up nearly 30% in the past six months to all-time highs. This, along with a recent hawkish turn by the central bank, has pumped the Canadian dollar to more than three-year highs above 81 cents US (below C$1.23).”
“Resource prices are expected to ease moderately as more supply comes online and as consumer spending is diverted toward the service sector. Still, prices should remain supportive, and with the BoC likely to raise rates before the Fed, the loonie looks to have found a higher flight path.”
“We see USD/CAD cruising to 83.3 cents at year-end and to 85.1 cents (C$1.175) by late 2022.”
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FXStreet Insights Team
FXStreet
The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.
