EUR/CAD Outlook: Slightly positive, but likely to move sideways, given its position near the recent average within a stable range.
Key drivers:
• Rate gap: The European Central Bank's cautious stance against the Bank of Canada's steady approach keeps the euro at a slight advantage over the loonie.
• Risk/commodities: Oil prices are currently above average, which typically supports the CAD, but the recent volatility makes the currency's movement less predictable.
• One macro factor: Canada's GDP stagnation highlights the impact of recent trade tensions, which may weigh on the CAD going forward.
Range: EUR/CAD is expected to drift within the recent stable range, with potential for fluctuations based on incoming economic data.
What could change it:
• Upside risk: A significant rebound in Germany’s retail sales could strengthen the euro.
• Downside risk: Continued weakness in Canadian GDP due to trade threats could pressure the CAD further.
