USD/CAD: ‘Loonie Stuck In The Mud’; Where To Target?

By CIBC via eFXNews

CIBC discusses CAD outlook and maintains a neutral bias, targeting USD/CAD at 1.30 by end of Q1 and at 1.32 by end of Q3.

“With oil unlikely to get back to its 2018 highs, Canada will be left with a significant current account deficit weighing on its currency.

More broadly, we might over the longer term end up needing a weaker exchange rate if exports are to supplant housing and other debtfinanced household activity as a growth driver. Indeed, we would be looking for that further weakening in the Canadian dollar in 2020 if it were not for the offsetting pull of US dollar weakness against other majors,” CIBC argues. 

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