Canadian Dollar Forecast Raised Despite Ongoing Trade Tensions

A Reuters poll of foreign exchange analysts has raised forecasts for the Canadian dollar's performance in the coming months, despite ongoing trade tensions between Canada and the United States.

The median forecast is for the CAD to edge lower by 0.4% over the next three months, reaching 1.39 per U.S. dollar or 71.94 U.S. cents, compared to a previous forecast of 1.40.

However, in a year's time, analysts expect the Canadian currency to strengthen by 1.8%, reaching 1.36 per U.S. dollar.

Monex Europe's head of macro research, Nick Rees, expects trade tensions with the U.S. to eventually be resolved, allowing domestic macro data to recover and contributing to a modest strengthening of the CAD.