USD/CAD outlook remains cautious – TDS

Analysts at TD Securities gave their views on the Canadian Dollar in the near term.

Key Quotes

“Growth continues to run at a near trend pace as the economy adjusts to mortgage rules and past rate hikes. Price pressures have firmed off previously absorbed slack. We still believe the growth story will keep the BoC on hold in April. Trade policy risks are improving but NAFTA talks are entering a key stage of the timeline with the goal for an agreement in principle by end-April”.

“Some of the bad news may already be in the price but data dependence will reign supreme. With growth decelerating (but still decent), the debt overhang/macroprudential measures beginning to bite and near-dated expectations a bit lofty still, CAD may still struggle to perform. We note however that receding NAFTA risks might provide some room for a modest relief rally but growth matters suggest remaining cautious still”.