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CAD: All quiet on the northern front - TDS

FXStreet (Delhi) – Research Team at TDS, notes that the USDCAD continues to extend its range-bound run between 1.3250 and 1.3370, the zone where it has spent most of the last few weeks.

Key Quotes

“Spot remains closely aligned with developments in oil markets. With crude prices inching higher over the last several days, USDCAD has retained its heavy tone. Rate differentials, however, have widened out further in favor of the USD over the last several sessions. The net effect of these – and other key drivers – implies that our estimate of Fair Value currently stands at 1.3405.”

“With US investors out today (and many tomorrow as well), we expect the quiet tone to continue into next week. The data and event calendar picks up dramatically however – both globally and with respect to Canada. On the domestic front, we have the September/Q3 GDP reports (1 Dec), the BoC rate decision (2 Dec), International trade data (4 Dec), the December OPEC meeting (4 Dec), and Canada’s November employment data (4 Dec).”

“We note that EURCAD continues to ratchet lower. We continue to expect further declines in coming days and see notable scope for acceleration to the downside as next week’s ECB meeting comes into finer focus. We think this cross could test support below 1.40 in coming days, but see potential for a move lower.”

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