30 Jul 2015
USD/CAD keeps the target at 1.35 medium-term – Westpac
FXStreet (Edinburgh) - Strategist Richard Franulovich at Westpac reiterated its view of the pair reaching 1.35 by year-end.
Key Quotes
“USD/CAD’s failure to hold above the important 1.30 psychological level and the subsequent sharp rejection off that level suggests the steady 10 figure up move since mid-May is very mature, if not complete”.
“The growth picture however remains murky at best and markets are pricing in only a slender 36% probability of one more BoC rate cut by year’s end”.
“The BoC’s recent downwardly revised growth projections for Q2 - 0% growth – are closer to the money but their forecasts for 2.0% average growth in H2 look optimistic given the lagged impact of the already known fall in energy prices point has historically been associated with barely half that growth pace. 1.35 the target for USD/CAD before the year is out”.
Key Quotes
“USD/CAD’s failure to hold above the important 1.30 psychological level and the subsequent sharp rejection off that level suggests the steady 10 figure up move since mid-May is very mature, if not complete”.
“The growth picture however remains murky at best and markets are pricing in only a slender 36% probability of one more BoC rate cut by year’s end”.
“The BoC’s recent downwardly revised growth projections for Q2 - 0% growth – are closer to the money but their forecasts for 2.0% average growth in H2 look optimistic given the lagged impact of the already known fall in energy prices point has historically been associated with barely half that growth pace. 1.35 the target for USD/CAD before the year is out”.