The Bank of Canada’s liquidity and credit backstops have contained market disruptions but genuine healing has yet to take place. USD/CAD to escalate in the coming weeks, according to analysts at Westpac Institutional Bank.
“USD/CAD has been biding its time around 1.40- 1.45 since mid-March but appears poised for a fresh leg higher to 1.50 and beyond.”
“The loonie has a lot of ground to cover lower before it is more in line with the steep fall in Canada’s terms of trade. USD/CAD on track to test 1.50+ in Q2.”