Canadian Dollar Expected To Rise In 2023: Poll
A new poll by the Reuters News Agency has found that a growing number of analysts expect
the value of the Canadian dollar to increase over the next year.
Year-to-date, the Canadian dollar has declined 7% against the U.S. dollar. However, it has fared
better than other G10 currencies except for the Swiss franc.
On September 30, the loonie dropped to its lowest level in more than two years, touching 72.26
The decline in the Canadian dollar comes as the Bank of Canada aggressively raises interest
rates to lower inflation. Canada's central bank has raised interest rates by 300 basis points
since March to 3.25%.
Currency analysts now expect the Canadian dollar to strengthen 1.6% to 1.34 per U.S. dollar
within three months' time, compared with a September forecast of 1.30.
Looking out to next year, currency analysts expect the loonie to advance to 1.30, up from 1.25
in a poll taken a month ago.
Analysts say that renewed strength in commodities, particularly energy prices, will help to
bolster the Canadian dollar.
However, money markets are betting that the U.S. Federal Reserve will end its monetary policy
tightening cycle with a higher benchmark interest rate than that of the Bank of Canada, a
development that could push the loonie lower.
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