Forecasts for AUD to CAD
The AUD to CAD exchange rate has recently shown some resilience, reaching 14-day highs near 0.8909, although it remains just below its 3-month average. Over the past weeks, the pair has traded within a 7.4% range, from a low of 0.8496 to a high of 0.9122. This stability comes amid fluctuating risk sentiment influenced by both domestic and global factors affecting the two currencies.
For the Australian dollar (AUD), initial gains driven by a surprising rise in export figures were tempered by broader market sentiment, particularly after the recent announcement of U.S. tariffs on Australian goods. Analysts suggest that unless the upcoming retail sales figures for March demonstrate significant growth, the AUD may struggle to maintain upward momentum, especially as it is a risk-sensitive currency linked closely to global economic conditions and commodity prices.
On the Canadian dollar (CAD), its value continues to correlate closely with oil prices due to Canada’s status as a major oil exporter. Recent data indicates that oil prices are currently at 90-day lows, trading around 61.29 USD, which is 13.2% below its 3-month average. This significant downturn in oil prices could potentially weigh heavily on the CAD, particularly if the trend persists and results in diminishing revenues for Canada's oil sector.
The Bank of Canada’s monetary policy further complicates the outlook for the CAD, as interest rates and economic indicators come under scrutiny. With little new economic data available, CAD's movements may continue to reflect trends in oil prices and fluctuations in the U.S. dollar.
In summary, analysts believe that while the AUD may receive short-term support from favorable domestic data, ongoing trade tensions and external economic pressures could lead to volatility. Meanwhile, CAD's trajectory remains vulnerable to oil market conditions, reinforcing a correlation in the AUD/CAD exchange rate. As both currencies navigate these complexities, market participants should remain vigilant about upcoming economic releases and global developments that could impact trade and investment flows.
