The Canadian dollar remains under pressure with falling oil prices.
We have not reached the bottom of the barrel according to the team at Citi:
Here is their view, courtesy of eFXnews:
Citi analysts expect that USD/CAD may rise toward 1.4200 for the coming 0-3 months.
“Since petroleum products are Canada’s major export, the persistent oil weakness may dampen Canada’s export income. This will likely be CAD-negative.
Besides, Citi’s Canada Economic Surprise Index plunged to -71.5 recently, the worst among major currencies, reflecting that economic data in Canada continues to trail market expectations. For instance, Canada’s Core CPI growth (MoM) moderated from +0.3% to -0.3% in Nov. GDP growth (YoY) fell from +0.1% to -0.2% in Oct,” Citi argues.
On the technical front, Citi notes that USD/CAD continues to be supported by 20MA
“Technical indicators suggest USD/CAD may rise toward 1.4001-1.4200 upon consolidation, with support at 1.3721,” Citi projects.
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