USD/CAD seen around 1.40 in the next months – BTMU

Lee Hardman, Currency Analyst at BTMU, believes the pair could visit the 1.4000 neighbourhood in the next months.

Key Quotes

“We are assuming that President Trump’s policies will not significantly weaken the outlook for the Canadian economy. The recent announcement from President Trump that the Keystone XL pipeline has been revived and another pipeline in the Dakotas has been expedited highlights that there are some potential benefits for Canada’s economy as well”.

“If President Trump implements across-the-board tariffs on imports from Canada and/or implements a border tax adjustment, it could result in the loonie becoming significantly weaker than our current forecasts thereby potentially lifting USD/CAD back into the 1.4000’s. At the very least the policy uncertainty from President Trump should encourage a more volatile loonie”.