January 25, 2023 17:17 GMT
ING: Targeting USDCAD 1.27-1.28 By Summer [corrected from RBC attribution]
[Correcting initial post that mistakenly attributed it to RBC and not ING]
- Given Canada's high household debt exposure and greater vulnerability to rising interest rates via the mortgage market structure, ING think the economy and inflation could slow more rapidly than the BoC is currently projecting.
- ING eye a potential first cut coming as soon as late in the third quarter.
- "In the near term the USD/CAD bias may shifting to moderately bullish in light of today’s BoC decision and the Federal Open Market Committee risk event next week. However, the longer-term profile for USD/CAD looks likely to stay downward-sloping as USD declines across the board and CAD may benefit from improved risk sentiment. We target 1.27-1.28 by this summer."