Bank of America: Fed pause will push Canadian doll

Aihuicha, August 30th: Bank of America strategists Howard Du and Carlos Capistran said that if the Federal Reserve keeps interest rates unchanged at its meeting next month, the Canadian dollar could rise after a sharp fall in August. The Canadian dollar will rebound from its current oversold territory in the short term to 1.33 Canadian dollars to the US dollar, which is the trading level in early August. Bank of America also predicts that the Bank of Canada will start the rate cut cycle ahead of the Federal Reserve in the second quarter of 2024, as the Canadian economy and inflation are decelerating faster and unemployment is already rising. The Canadian dollar is expected to rise to C$1.26 to the U.S. dollar by the end of next year. However, should Canada's economic growth decline more sharply and decouple from the resilient U.S. economy, the Canadian dollar will come under pressure.