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USD to CAD Forecasts

The weakness of the US dollar plus oil market volatility are affecting USD to CAD forecasts into 2021

 
1 CAD = 0.8112 USD
  
USD to CAD at 1.2325 is near its 90-day average, range 1.2037-1.2627.
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USD/CAD – The Bank of Canada became the first major central bank to scale back asset purchases at the conclusion of its April meeting.

USD/CAD was trading at 1.2610 and has since slid to a low of 1.2007 earlier this month. The USD rallied and has traded a range between 1.2120 and 1.2260 until Thursday’s FOMC hawkish shift.

Friday saw a good break on the topside above 1.2320 to finish at 1.2470. A base on USD/CAD has been formed and the next move is likely toward 1.2550-1.2600.

OFX say CAD could trade between 1.1900 (stronger CAD) and 1.2300 (weaker CAD) in June. As CAD is already trading at the higher end of this range, it has more scope to lose value.

Many market participants are heavily favouring the CAD over the USD, so any unwinding of these positions will leave the CAD vulnerable to a sell-off, reducing demand and decreasing its value.

The Bank of Canada’s announcement in late April to bring forward the time when it expects to raise interest rates helped the Canadian dollar to rise up above US80 cents (USD below C$1.23).

The Canadian central bank’s decision to cut back its bond purchases – quantitative easing (QE) – was due to Canadian house prices, employment and the currency.

The Canadian Real Estate Association calculates house prices have climbed 17 per cent in 12 months.

“The bank will continue to monitor the potential risks associated with the rapid rise in house prices,” the Bank of Canada said in its statement this week and said it was “tapering” its asset purchases due to the “progress made in the economic recovery”.

In 2021 the Canadian dollar has risen as a global economic recovery takes hold, with larger gains if the Bank of Canada is seen to be preparing to reduce monetary stimulus, economists say. CAD Forecasts

This week the US Federal Reserve pushed its growth forecasts higher and moved the timing of its interest rate hikes to 2023. This sent the US Dollar higher against all its Rivals on Thursday and Friday. USD Forecasts

 

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USD to CAD Exchange Rates – Compare and Save

Note that forecasts and predictions for the USD/CAD exchange rate change all the time, affected by news events and relative sentiment towards the Canadian and US economies and this exchange rate is even more volatile than usual because of the uncertainties around the Coronavirus pandemic.

You can read more about other CAD exchange rate forecasts here CAD Forecasts for 2021.

Canadian dollar in 2020

The CAD hit its highest level against the dollar in 2.5 years towards the end of 2020, driven by the Canadian employment report, which was stronger than expected sixth time in seven months in November. However, it was experiencing weakness against euro and pound.

What is a good USD to CAD exchange rate?

Whether the US dollar will rise or drop in the future versus the Canadian dollar is a difficult question and the answer really depends on many factors. The best way to consider the current USD-CAD relative value is to check the change in the exchange over a range of periods to the present day. The below table does this for periods going back 10 years.

USD/CADChangePeriod
15 Jun 2021
1.2186
1% 1 Week
23 May 2021
1.2070
2% 30 Days
24 Mar 2021
1.2579
2.2% 90 Days
22 Jun 2020
1.3505
8.9% 1 Year
23 Jun 2016
1.2774
3.6% 5 Years
25 Jun 2011
0.9852
24.9% 10 Years

USD/CAD rate change to 22-Jun-2021 → 1.2308

 
Please note that the opinions of our authors are their own and do not reflect the opinion of Best Exchange Rates and should not be taken as a reference to buy or sell any financial product.