Westpac analysts point out that USD/CAD is grinding higher but cannot surpass 1.3400 level, although the pair has reversed some of new year losses amid bounce back stall in crude oil due to US-China trade concern.
“The next BoC hike may be several months away but pricing remains very light, just +14bp priced in through to October 2019.”
“Mandated Alberta production cuts and OPEC supply agreements have helped place a floor on energy markets and the discount on Canada’s Western Select.”
“A likely dovish leaning FOMC next week and positive soundbites from US-China trade negotiations potentially a catalyst for some renewed USD/CAD downside next week.”
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