3 Dec 2014
BoC statement to remain neutral – TDS
FXStreet (Barcelona) - According to the Research Team at TD Securities, a weaker CAD, lower crude oil prices combined with the strength shown by growth & inflation will keep the BoC neutral today.
Key Quotes
“USDCAD has traded lower overnight defying both the stronger big-dollar trend and the softer tone in crude oil prices that have carried over from yesterday.”
“Our expectation is that the BoC statement will remain neutral, balancing risks from lower crude oil prices with the recent strength shown by both economic growth and inflation and the shock-absorbing services paid by a weaker CAD.”
“On the charts, the USD’s rejection of the early November high at 1.1465 again earlier this week leaves a bit of a dark technical cloud over the near-term USDCAD outlook and the drag of the CAD crosses (EURCAD nearing 1.40 again) may see funds struggle to break decisively higher for the moment.”
“We rather think the near-term outlook favours a little more range trading, with USDCAD well-supported in the low 1.13s.”
“Fundamentally, we think minor dips are a buy; Fundamentally, USDCAD looks under-valued relative to our spot fair value estimate (based on spreads and terms of trade) of 1.1610 currently.“
Key Quotes
“USDCAD has traded lower overnight defying both the stronger big-dollar trend and the softer tone in crude oil prices that have carried over from yesterday.”
“Our expectation is that the BoC statement will remain neutral, balancing risks from lower crude oil prices with the recent strength shown by both economic growth and inflation and the shock-absorbing services paid by a weaker CAD.”
“On the charts, the USD’s rejection of the early November high at 1.1465 again earlier this week leaves a bit of a dark technical cloud over the near-term USDCAD outlook and the drag of the CAD crosses (EURCAD nearing 1.40 again) may see funds struggle to break decisively higher for the moment.”
“We rather think the near-term outlook favours a little more range trading, with USDCAD well-supported in the low 1.13s.”
“Fundamentally, we think minor dips are a buy; Fundamentally, USDCAD looks under-valued relative to our spot fair value estimate (based on spreads and terms of trade) of 1.1610 currently.“