USD/CAD to ease toward 1.30 by year-end – Scotiabank

The Canadian Dollar (CAD) has strengthened modestly since the start of June, rising some 2% against the generally weaker USD. Economists at Scotiabank analyze USD/CAD outlook.

An overshoot to the 1.28 area is not to be excluded as a risk in Q3

We anticipate the peak in the global tightening cycle will give risk appetite a broad lift in the months ahead, which should add to CAD tailwinds.

We anticipate some modest improvement in the CAD versus the USD over the second half of the year and continue to target USD/CAD easing to 1.30 by year-end. 

An overshoot to the 1.28 area is not to be excluded as a risk in Q3.