USD/CAD: Lower greenback to be an important positive driver for the loonie – CitiBank

Analysts at Citibank see the USD/CAD falling to 1.29 on a 0-3 month forecast and to 1.25 on a 6-12 months horizon. They expect the current positive momentum for the loonie to continue in 2021.

Key Quotes:

“The Loonie has benefitted greatly from decreasing global uncertainty, as it trades high beta to risk-on; we expect this momentum to continue through 2021 and correspondingly a lower USD to be an important positive CAD driver. Besides, The Canadian government continues to support the economy. On the central bank front, the BoC has already paused some of their easing measures, which may also support CAD.”

“USDCAD’s RSI is in neutral territory and the pair may range trade between 1.2929-1.3281 in short term, with next support at 1.2783.”