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Economists at Credit Suisse lower their USD/CAD target from 1.2550 to 1.2260 and look to sell rallies to 1.2700.  

Loonie’s fundamentals geared to US growth and oil prices

“The fundamental picture in Canada remains unequivocally strong, as the prospect of US demand momentum adds to the already beneficial impact from oil prices and from the multi-year consolidation/retooling of the local energy transportation network.”    

“The strong fiscal spending effort from the Trudeau government provides a homegrown source of support for CAD. Sovereign credit concerns remain on the backburner.”    

“We think the loonie has potential to appreciate further over the course of Q2. We lower our USD/CAD target from 1.2550 to 1.2260.”

“From a tactical standpoint, we see risks that suggest caution is warranted in picking entry levels for short USD/CAD positions, ideally north of 1.2700.”