On May 10, in a report from the National Bank of Canada, analysts forecast USD/CAD to remain in the 1.33-1.38 range for the next quarter.
The Canadian dollar has strengthened in recent weeks, gaining nearly 5 cents against the U.S. dollar, according to economists at the bank.
The resilience of the Canadian economy and a less dovish BoC have led to a sharp reduction in the U.S.-Canada spread since the collapse of the Silicon Valley bank.
Looking ahead, we do not think the Canadian dollar will benefit from continued narrowing interest rate differentials.
At the same time, given the recent decline in commodity prices, we expect USD/CAD to remain in the range of 1.33-1.38 in the next quarter.