CAD has come under pressure over the last month. Economists at Danske Bank expect USD/CAD to move gradually higher toward 1.39 over the coming months.

Good downside potential in EUR/CAD

“We still pencil in a stronger USD which alongside a broad tightening of global financial conditions should act as a supportive factor for the cross. That said, if we are right that energy as sector will be among the winners in the coming years that does leave some attractive properties of a long CAD position.”

“While our USD/CAD profile still points higher we think there’s a good downside potential in EUR/CAD.”

“Forecast: 1.36 (1M), 1.38 (3M), 1.39 (6M), 1.39 (12M).”