Recent analyst forecasts indicate a mixed outlook for the AED to CAD exchange rate, reflecting developments in both the Canadian and UAE economies.
The Canadian dollar (CAD) has been under pressure due to declining oil prices, which fell to 90-day lows near $65.50, significantly below its three-month average. As a commodity-linked currency, the CAD is sensitive to fluctuations in oil prices since Canada is a major oil exporter. Analysts point out that the drop in oil prices has contributed to CAD's recent softness, particularly amid weak domestic inflation data and increased unemployment expectations, which rose to a near four-year high of 7% in August.
Conversely, the UAE Dirham (AED) benefits from a robust economic outlook supported by increased consumer spending, foreign direct investments, and diversification efforts. Predictions suggest that UAE GDP growth for 2025 could range from 4.1% to 6.2%, creating a solid foundation for the AED. The introduction of the Digital Dirham and the easing of trade payments using the Indian Rupee could further bolster the Dirham’s standing in international markets.
The recent price data shows that the AED to CAD exchange rate is currently at 7-day highs near 0.3767, just 0.8% above its three-month average of 0.3738. This suggests a stable yet slightly bullish trend for the AED against the CAD as AED trades within a narrow 2.5% range from 0.3695 to 0.3788.
In summary, while CAD faces downward pressure due to external factors like fluctuating oil prices and internal economic indicators, the AED is poised to remain strong due to its resilience in economic growth and positive developments. Currency traders and businesses should closely monitor these factors to optimize their international transactions and currency exchanges.
