The CAD to ILS exchange rate has a bearish bias, trading near 90-day lows.
Key drivers include:
- The interest rate differential remains stable, with the Bank of Canada maintaining its policy rate at 2.25%, while the Bank of Israel indicates a strong growth outlook that could influence future rate adjustments.
- Improved geopolitical stability in Israel has boosted confidence in the ILS, supporting its appreciation against the CAD.
- Recent employment gains in Canada and a drop in oil prices (trading 2.9% below the 3-month average) have added downward pressure on the CAD.
In the near term, the CAD to ILS is expected to fluctuate within a relatively stable range.
Upside risks could arise from rising oil prices or stronger Canadian economic data, while downside risks may stem from renewed geopolitical tensions in the region or changes in the Bank of Israel's monetary policy.