On Tuesday, Bank of America (BofA) analysts suggested that there might be a limit to how much the U.S. dollar (USD) can appreciate against the Canadian dollar (CAD), despite recent trends showing CAD weakness primarily driven by a broad USD rally.
The pair has seen a notable rise, attributed to the surge in global yields led by the U.S. and a widened interest rate differential favoring the USD.
BofA analysts noted that while the CAD has weakened against a trade-weighted index (TWI) by approximately 1% in April, the decline is only 0.7% when excluding the USD impact. This indicates that the CAD’s depreciation is…
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