The USD/CAD pair has retraced to the 1.25 area. Although the loonie is set to stabilize round this region, in the view of economists at ING, USD/CAD have to pass slowly however actually to the 1.20 degree in the coming months.
USD/CAD waiting for a gradual go to 1.20
“Domestically, fundamentals have remained very supportive for CAD. The Bank of Canada has saved tapering asset purchases as the Canadian economic system recovered and we assume they will give up QE through year-end, which need to permit markets to maintain speculating that the first hike will come already in 2022.”
“In the subsequent months, USD resilience and uneven world restoration sentiment may additionally hold USD/CAD round 1.25, however we nevertheless assume the pair to fashion decrease to the 1.20 place as some stabilisation in sentiment would permit CAD’s price profile to assist the currency.”