Economics
Top Loonie Forecasters See Weakness Ahead on More Fed Hikes
- Bank of Canada is expected to keep interest rates unchanged
- Monetary policy divergence will subdue the Canadian dollar
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The Canadian dollar will weaken in the coming months, as the Federal Reserve is expected to continue increasing rates while the Bank of Canada is bound to stay put, according to the currency’s highest-ranked forecasters.
The loonie started strong in 2017, recovering from a 10-month low at the end of 2016 by taking advantage of January’s broad-based decline in the U.S. dollar. But it has faltered in recent weeks, reducing this year’s gain to 0.6 percent, lagging most Group of 10 currencies.