On Friday TD Securities bought NZDCAD at......>

FOREX: On Friday TD Securities bought NZDCAD at 0.8970, with a stop at 0.8780 &

a target of 0.9300.

- TD noted that "since the USD rally began in mid-April, the CAD has

outperformed most of its G10 peers quite handily with NZD the major laggard. The

NZD screens ~4% cheap on a HFFV basis as it lags the improvement in the terms of

trade. Further, negative data surprises are near a 5yr extreme and taken in

conjunction with an advanced positioning washout suggests to us that a lot of

bad news is in the kiwi price. For CAD, we think we have passed peak optimism in

NAFTA insofar as it providing a sustained bid to the currency. Though we expect

the BoC to hike in July, that is largely priced and we firmly disagree with the

cumulative tightening priced in further out the curve; ~2 by year-end & ~3 by

Q1-19. This will be too tall of an order for the BoC. Too much implied

tightening also suggests that the CAD has more to lose vs. its DBFX peers where

the OIS curve is benign. A rate cut by the RBNZ is a low probability event,

making NZDCAD topside a cleaner expression of idiosyncratic CAD risks."