The Canadian dollar has been battered in recent weeks. But economists at the National Bank of Canada still expect the loonie to appreciate further in the coming months.

Interest rate spread to stay positive

“Rising commodity prices, a current account surplus, a strong labour market and positive interest rate differentials argue for an appreciation of the Canadian dollar.” 

“Despite the uncertainty created by the latest COVID variant, we remain comfortable with our current forecast of a C$1.20 rate for the US dollar in 2022.”