USD/CAD to drop back to 1.3000 by the second half of the year – ING

FXStreet Insights Team FXStreet

The Loonie’s dip versus the US Dollar (USD) has been smaller than any other G10 currency since the start of the week. Economists at ING analyze USD/CAD outlook.

CAD looks less attractive than its oil-peer NOK this year

It is now clear that markets see a very direct link between the Bank of Canada and Fed policy trajectory, and the pro-cyclical trades induced by softer US data often rewarded other high-beta G10 currencies (NOK, SEK, AUD, NZD) more than CAD.

We suspect today’s retail sales out of Canada won’t impact CAD as much as the upcoming US releases, which may remain the case as long as the USD retains its strength.

Ultimately, a USD decline and CAD’s rate attractiveness should send the pair back to 1.3000 by the second half of this year, but we still think the market is underpricing BoC easing, and CAD looks less attractive than its oil-peer NOK this year also from a valuation perspective.

Author

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.

EUR/USD climbs to daily highs near 1.1820

EUR/USD now picks up pace and advances to the area of daily peaks north of the 1.1800 barrier at the end of the week. The pair’s decent move higher comes against the backdrop of a generalised lack of direction in the FX galaxy and the mild offered stance in the US Dollar.

GBP/USD trims losses, retests 1.3460

After briefly challenging its key 200-day SMA near 1.3440, GBP/USD now manages to regain some balance and revisit the 1.3460 zone on Friday. Cable’s pullback comes as the selling pressure on the Greenback gathers traction, reigniting some recovery in the risk-linked space.

Gold flirts with four-week highs past $5,200

Gold extends its rebound, climbing for a third consecutive session and pushing back above the $5,200 mark per troy ounce on Friday. The move higher continues to draw support from lingering geopolitical tensions and the ongoing uncertainty surrounding US trade policy, both of which are keeping safe-haven demand firmly in play.

Bitcoin, Ethereum and Ripple consolidate with short-term cautious bullish bias

Bitcoin, Ethereum and Ripple are consolidating near key technical areas on Friday, showing mild signs of stabilization after recent volatility. BTC holds above $67,000 despite mild losses so far this week, while ETH hovers around $2,000 after a rejection near its upper consolidation boundary.

Changing the game: International implications of recent tariff developments

The Supreme Court ruling on International Emergency Economic Powers Act (IEEPA) tariffs provides limited relief for the rest of the world, with weighted average tariff rates modestly lower.

Starknet unveils strkBTC, shielded Bitcoin transactions on Ethereum Layer 2

Starknet, the Ethereum Layer 2 network developed by StarkWare, today announced strkBTC, a wrapped Bitcoin asset that introduces optional shielding while preserving full DeFi composability.