Canadian Dollar Forecast Jan. 10/08
Forexmentor.com Forex Trading Price Action
The loonie is retreating from parity with the U.S. dollar, as the BoC eyes further rate cuts in response to the expectation of weakening inflation, and as Canada’s trade and government budget surpluses appear headed for the red – thanks to the strong dollar’s drag on exports, slow U.S. growth and weaker commodity prices.
This is especially surprising, given that Canada is a major exporter of oil. There is a thirst for imports, given the high loonie and competition from Asian in manufacturing. Shorting the loonie and/or buying the USD/CAD pair on the forex seem like pretty safe bets to me.
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