#USDCAD @ 1.37666 : Policy divergence pummels the Loonie – MUFG
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USD/CAD pushed higher and touched its strongest level since October at 1.3817. Economists at MUFG Bank expect the Loonie to remain under pressure.
“While we expect the US economy to slow more as well in response to higher rates it is happening with more of a lag that is opening up a widening policy divergence between the BoC and Fed in the near-term.”
“Short-term yield spreads between the US and Canada have hit fresh highs this week taking out the highs from late last year, and are placing further upward pressure on USD/CAD that has jumped from around 1.3600 to 1.3800.”
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