CAD/CLP Outlook:
The CAD/CLP exchange rate is slightly positive but likely to move sideways as it approaches its recent average and trades near recent highs. The Canadian dollar benefits from stronger oil prices, but mixed signals limit its momentum.
Key drivers:
• Rate gap: The Bank of Canada is holding rates steady at 2.25%, contrasting with the Central Bank of Chile's rate maintained at 5.00%.
• Risk/commodities: Oil is trading at near highs, which typically supports the Canadian dollar as Canada is a major oil exporter.
• One macro factor: Improvements in Canada’s job market, with significant employment growth last December, may bolster the CAD.
Range:
The CAD/CLP is expected to drift within its recent range, testing the upper limits but remaining stable.
What could change it:
• Upside risk: A positive report on Canada’s GDP could strengthen the CAD further.
• Downside risk: A decline in oil prices or concerns over global economic performance may pressure the CAD.