USD/CAD: Balance of risks skewed to the upside – Danske Bank

According to analysts from Danske Bank, the dangers in the USD/CAD pair are tilted to the upside, as they see a large USD electricity ahead. They forecast the pair at 1.29 in twelve months.

Key Quotes:
“Bank of Canada is an increasing number of guiding markets closer to tighter economic stipulations in Canada by using each decrease bond purchases and greater coverage fees in H2 2022. That said, the oil connection to the Canadian financial system nevertheless leaves CAD susceptible to international boom possibilities and now not least international manufacturing. Also with our expectations for wide USD strength, we assume the stability of danger is skewed in the direction of the topside for USD/CAD from modern levels. Fundamentally, we nevertheless think about CAD to be a extra USDdependent and much less reflation touchy model of NOK.”

“We forecast USD/CAD at 1.27 in 1M (from 1.26), 1.29 in 3M (from 1.26.), 1.32 in 6M (from 1.29) and 1.33 in 12M (from 1.29).”

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