USDCAD: Expect to see 1.3400- 1.3600 range in the longer term - Westpac

Imre Speizer, Research Analyst at Westpac, notes that the USD/CAD has bounced off the 1.3000 area and shows signs of breaking above 1.3200 during the week ahead.

Key Quotes

“Longer term, we expect to see it in the 1.3400- 1.3600 range, where it spent much time in Nov and Dec.”

“While Canada’s jobs and trade data has shown a solid improvement lately, disappointing retail sales data reminded all of downside risks to growth. Further, neither yield spreads nor crude oil are pointing decisively in favour of a break lower in USD/CAD.”

“The underlying background atmospherics still favour a higher USD/CAD, certainly as long as Trump threatens to dismantle NAFTA and with March FOMC hike odds marching higher.”