For all of 2024, we expect a cumulative 100 bps of rate cuts from the Bank of Canada, just a little less than the cumulative 125 bps of rate cuts from the Federal Reserve over the same period. Moreover, in both Canada and the United States we anticipate subdued economic growth, but no recession. 

Canada's economic and monetary policy backdrop has restrained the Canadian Dollar during the early part of 2024, a trend that could continue for the time being. 

Given a broadly similar growth and monetary policy outlook for Canada and the United States, it is also possible that Loonie could be an underwhelming performer over the medium term. Even by the end of 2024, we see only modest gains in the Canadian currency, forecasting a USD/CAD exchange rate of 1.3300 by the end of this year.