Should CAD Be A Bigger Winner? How To Play It? – CIBC

The Canadian dollar managed to recover quite nicely from the 11 year low against the US dollar, and it now faces a new test: the BOC decision.

The team CIBC analyze the pair:

Here is their view, courtesy of eFXnews:

Since September 1st, oil prices have been fairly stable between $45-50 bbl, but it’s commodity currencies such as the Aussie, Kiwi and Canadian dollars that have performed best during a period of broad USD weakness, notes CIBC World Markets.

“But should the loonie have been doing even better? Despite much better domestic economic data, the C$ has gained less during the past 6 weeks or so than the A$. That could be because of uncertainty regarding the upcoming election, or because of concern regarding Canada’s exposure to a slowing US,” CIBC argues.

“Either way, we like buying the C$ against the Aussie, even if both lose ground again against the greenback once the Fed initiates the first hike,” CIBC advises.

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