The market for CAD to INR is currently bearish.
Key drivers include:
- The interest rate differential favors the CAD, with the Bank of Canada's steady policy rate at 2.25%, while the Reserve Bank of India's actions may lean towards maintaining softer rates to support growth.
- Weaker manufacturing data in Canada and fluctuating oil prices around $60 have added pressure on the CAD.
- The Indian economy is showing signs of resilience, supported by projected strength in growth and job creation despite forecasts of potential depreciation of the INR towards 90 per USD.
The near-term trading range for CAD to INR appears to be stable, maintaining a slight upward trend above its recent average. However, shifts in global oil prices or significant changes in economic data from either country could alter this trajectory. Upside risks include an unexpected oil price recovery that could support the CAD, while downside risks may arise from ongoing weakness in Canadian manufacturing, pressuring the currency further.