The value of the Canadian dollar will continue to plummet to as low as 75 cents US in early 2018, an analyst at CIBC warned on Monday.
In his report, Benjamin Tal, Deputy Chief Economist at CIBC World Markets, argues that “several factors stand in unison in the same direction – a falling dollar”.
After the rise observed following the announcement of two successive increases in the key rate up to 1%, in July and September, the dollar seems ready to start falling again.
To explain its fears, Mr. Tal is referring to economic uncertainty in our southern neighbors. According to him, the negotiations surrounding the North American Free Trade Agreement (NAFTA), the identity of the next governor of the US Federal Reserve who is late to be unveiled and the inability of US President Donald Trump to adopt his policies economically will pull the loonie down.
The dollar peaked at 82.56 US cents on September 11th. Since then, its value has fallen, especially in the last 10 days when the Canadian currency lost more than 2 cents.
The Canadian dollar closed slightly below 78 cents US on Monday.