CAD strategy post BoC surprise rate hike - Nomura

Analysts at Nomura offered their CAD strategy after the BoC raised rates today.

CAD gone Loonie - Nomura

Key Quotes:

"The September rate hike has caught the market a bit off-guard, but helps reaffirm our positive outlook for the CAD.

With Canada’s robust economic performance becoming self-reinforcing, we think the market will continue to price in prospects of higher BoC interest rates, and as a result relative yield spreads should continue to move in favour of Canada, supporting the CAD.

And when combined with our bearish USD outlook, a move below 1.20 in USD/CAD in the not too distant future looks likely."