USD/CAD has declined below the 1.3500 level. Economists at ING anlayze the pair’s outlook.

USD/CAD to head towards the 1.3000 mark in the second half of 2024

The persistence of CAD’s correlation to US data and the strict link between Fed and BoC policy expectations means the room for a major break in either direction in USD/CAD does not seem very likely. 

We expect it to keep trading in a 1.3400/1.3600 range in the coming weeks before a clearer USD downtrend starts to emerge from the second quarter onwards and takes the pair towards the 1.3000 mark in the second half of 2024.