Analysts at TD Securities suggest that we are entering the window where CAD will become more topical with upcoming top-tier data releases and this may sway BoC odds for September but they lean against this narrative.
Key Quotes
“Instead we think too much optimism is placed further out the curve and our rates team has suggested BAU8/M9 flatteners.”
“The GDP data later this month will be key, but we note that it falls in the BOC’s blackout window with its rate decision on September 4th, leaving limited time between now and Poloz’s appearance at Jackson Hole to telegraph an earlier shift than our October hike expectation. With optimism running high in the CAD, we see appreciable position realignment risks.”
“In line with this, CAD crosses are beginning to look appealing with EURCAD an interesting candidate to make a topside tactical push towards trend resistance located near 1.52, as conditions in EUR appear deeply oversold.”
Share
