Credit Agricole CIB Research discusses USD/CAD outlook and targets the cross at 1.39, 1.37, and 1.35 by end of Q2,Q3, and Q4 respectively.

"The absence of evidence of a material shift in portfolio flows between Canada and the US may have helped keeping USD/CAD rather steady. All in all, there does not seem to be enough at this stage to pull USD/CAD out of its rangetrading pattern that has prevailed for the best part of the past year or so, and we thus stick to our forecast path that has embedded exactly that for the rest of the year," CACIB notes.

"With a marginal bias for USD/CAD to trade closer to the upper (rather than lower) end of the range in the coming months, primarily due to the risks surrounding the USMCA review around mid-year, although threats of a massive shake-up may have arguably diminished with the US administration being busy on other fronts. Further down the line, the CAD may eke out some marginal gains vs the USD on the basis of renewed monetary policy divergence next year," CACIB adds.