Forecasts for CAD to PHP
The Canadian dollar (CAD) has been under pressure recently, slipping despite a minor recovery in oil prices. Analysts highlight that ongoing trade tensions with the United States may be contributing to the CAD's decline. With the Canadian unemployment rate expected to uptick, there are concerns that this could further weaken the currency.
As a commodity-linked currency, the CAD's value significantly correlates with the oil market. Currently, oil is trading at USD 62.84, approximately 9.8% below its three-month average of USD 69.67. This decline, amidst a volatile trading range of 28.0%, suggests potential headwinds for the loonie, especially as Canada is one of the world's largest oil exporters.
Moreover, the Bank of Canada's monetary policy plays an essential role in shaping the CAD's trajectory. The direction of interest rates will influence investor sentiment and capital flows in and out of Canada. With current economic indicators suggesting a mixed outlook, CAD traders are advised to keep an eye on employment data and inflation trends.
In terms of its performance against the Philippine peso (PHP), the CAD is presently trading at around PHP 39.99, near 30-day lows and slightly below its three-month average of PHP 40.37. Historical patterns show that the CAD/ PHP pair has remained stable within a 3.9% range from PHP 39.71 to PHP 41.25. However, the potential for the peso to depreciate against the USD in the near future raises questions about the CAD's performance relative to the PHP since 75% of Canada’s exports are traded with the U.S.
Economic and political developments, particularly the impact of the recent mid-term elections in the Philippines and rising trade tensions, may further cloud the outlook for both currencies. Observers note that the political uncertainty surrounding these elections could negatively affect the PHP, especially given the Philippines' struggle to capitalize on international trade shifts compared to its regional peers.
Overall, the interplay of global oil prices, domestic economic performance, and geopolitical factors will be crucial in shaping the CAD/PHP exchange rate in the coming months. Investors and businesses involved in international transactions should remain vigilant to these dynamics to optimize their currency exchange strategies.
