Scotiabank economists update their USD/CAD forecasts. The pair is now expected to trade above 1.30 throughout the next year.
The forecast for the fourth quarter rises to 1.35
“We are pegging the Q4 USD/CAD forecast at 1.35 (from 1.30) and raising the 2023 USD profile a bit.”
“Now we only see the USD weakening below 1.30 next year.”
Relatively strong growth, a hawkish central bank and high commodity prices have done little to stem the rise USD/CAD this year and it’s hard to see any of those drivers offering additional support to CAD right now.”
“The CAD maintains a correlation very close and positive with US equities today, and weak risk appetite seems likely to persist as long as inflationary pressures are high and geopolitical tensions are high. This will keep the tone of the CAD smooth.”
Source: Fx Street
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