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The Canadian Dollar is going through a solid uptrend against its US counterpart. The USD/CAD has depreciated beyond 2% so far in October, retreating from 1.3400 highs to 1.3100 so far and, according to the FX research team at the National Bank of Canada, the pair will remain negative for the next 12 months.

Key Quotes

“The Canadian economy continues to show uncanny resilience. Government assistance to households remains generous and the bounceback in employment is more impressive in Canada than in the United States. Not only has total employment recovered faster, the participation rate has rebounded markedly.”

“This outperformance has led to a widening of short-rate spreads to the US and helped support the Canadian dollar. We have a 12-month target of C$1.28 to the USD but a cautious view for the period up to the US election.”