Richard Franulovich, Research Analyst at Westpac, points out that CAD is the most undervalued dollar bloc currency and as AUD, NZD and CAD have all been trading weaker than high frequency measures of their terms of trade would dictate.
Key Quotes
“CAD offers the most compelling value from a commodity valuation standpoint. Energy prices have eased about 10% from their highs but even so CAD has materially undershot this year’s run-up in crude oil. NAFTA disruption risk is the obvious CAD headwind but against that the BoC is much closer to lifting rates than either the RBA or the RBNZ.”
Share
