USD/CAD broke through its 1.32 resistance in September. Economists at the National Bank of Canada expect the pair to reach 1.39 by year-end before easing back to 1.30 by the end of the second quarter in 2023.

FOMC pivot expected by mid-2023

“With inflation cooling faster in Canada than in the US and the Bank of Canada unlikely to overtake the Fed in the coming months, as we expected, we do not see opportunities for a significant strengthening of the CAD against the USD until an FOMC pivot, which we expect in H1 2023.”

“We see USD/CAD at 1.39 at the end of Q4 22 and at 1.30 at the end of Q2 23.”