The Canadian economy continues to operate close to its potential and growth is more balanced, where Bank of Canada (BoC), is on the policy normalization path and has moved in synchronization with the Fed´s monetary policy. Furthermore, the Canadian economy is positively exposed to oil prices, but the heavy oil from Alberta has not enjoyed the recent oil price surge in WTI prices. However, increasing Chinese demand for heavy crude oil might influence the price. On the other side of the Atlantic, a stand-off between Brussels and Rome is brewing a possible crisis on the horizon. In 2017, the Eurozone enjoyed its strongest economic expansion in a decade. However, in 2018 it has recorded a slowdown. Amidst this slowdown, the Eurozone is facing a world without QE as the EU’s QE program is set to end in Dec 2018. We suggest to short the Eur/Cad.

 

Analysts: Ck Soumaoro (MSc in Economics) and Lois Anum (MSc in Finance)

 

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