Credit Agricole CIB Research maintains a positive bias on CAD over the medium-term, but stays neutral in the near-term.
"The CAD has been in demand of late with better risk sentiment and more supported commodity prices helping the currency...While we expect incoming data to prove constructive, this will be fully in line with central bank assumptions. Hence, we see little risk for data to have a meaningful impact on rate expectations. This in turn suggests it will remain about external factors such as risk sentiment to drive the CAD," CACIB notes.
"While we keep a positive big picture view, positioning as it stands suggests fresh buying interest is needed in order to trigger more sustained currency upside from current levels. This appears unlikely in the very short term, especially when considering that many positives seem to be in the price," CACIB adds.