Analysts Citibank expect a continued global economic recovery, with a weak dollar, which means that cyclically correlated exchange rates such as the loonie will continue to enjoy gains against the dollar. His forecast places the USD / CAD at 1.25 in a period of three months and at 1.22 in six to twelve months.
“A rapidly strengthening job market means that 80% of pre-COVID jobs recovered through November, compared to about 65% for the comparable metric in the US Citi Economics believes that” Stronger growth projections will allow for the elimination of adjustments at the April 2021 currency meeting“We should also note here that the BoC has already stopped some of its easing measures. Normally, a flexible and tight fiscal mix indicates an appreciation of the currency.”
“USD / CAD has moved higher since bottoming slightly below the 76.4% retracement level at 1.2677. The pair faces a fundamental resistance level at 1.2926-1.2994, which consists of the 55-day MA alongside the lows of December 2019 and September and November 2020, and a descending trend line. Support can be found at 1.2528 and 1.2630 “.
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