{"id":494170,"date":"2010-03-31T09:57:00","date_gmt":"2010-03-31T13:57:00","guid":{"rendered":"e2249889-c78b-43e3-9643-b1d7d4aa587b:416831"},"modified":"2010-03-31T09:57:00","modified_gmt":"2010-03-31T13:57:00","slug":"loonie-has-more-room-to-grow-ubs","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/494170","title":{"rendered":"Loonie has more room to grow: UBS"},"content":{"rendered":"<p>Strategists at UBS Wealth Management believe the Canadian dollar still has room to grow, even though it has already gained 20% on its U.S. counterpart over the past year. Rising commodity prices and strong economic data is going to keep the dollar going, they said in a note to clients \u2013 just before Statistics Canada reported <a href=\"http:\/\/network.nationalpost.com\/NP\/blogs\/fpposted\/archive\/2010\/03\/31\/analysts-reaction-canada-gdp-data-for-january.aspx\" >the economy grew<\/a> 0.6% month-over-month in January, above market expectations and the fastest monthly gain in three years. <\/p>\n<p>Also, more central banks will look to add the loonie as part of their foreign exchange reserves, UBS reckons.<\/p>\n<p>The UBS strategists said the strong economic data \u201cincreases the risk that the Bank of Canada might even <a href=\"http:\/\/www.financialpost.com\/story.html?id=2723025\" >hike interest rates<\/a> before the Fed does.\u201d That scenario is now seen as a given, with odds increasing of a June rate hike in Canada, although the consensus remains July. UBS expects the Federal Reserve to begin raising rates in the fall.<\/p>\n<p>\u201cWe expect oil prices to rise further, which should support the Canadian dollar. Improving risk sentiment could also help the risk-sensitive Canadian dollar,\u201d UBS said.<\/p>\n<p>Economic growth has been robust even though it was believed the Canadian dollar would act as a drag. But UBS noted the \u201cvery loose\u201d monetary policy helped to lift the country out of recession. The Canadian economy should continue to gain momentum once the U.S. economy begins to recover.<\/p>\n<p>Finally, the UBS note said the Canadian dollar is slowly emerging as a reserve currency for some central banks, citing <a href=\"http:\/\/www.nationalpost.com\/story.html?id=2463910\" >Russia as one example<\/a>. \u201cThe Canadian bond market is quite deep and provides better liquidity than the bond markets of most other commodity and emerging market countries. The Canadian dollar\u2019s role in the reserve diversification dynamic over the next few years is, in our view, another potential support factor for the currency.\u201d<\/p>\n<p><a href=\"mailto:pvieira@nationalpost.com\">Paul Vieira <\/a><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/network.nationalpost.com\/NP\/aggbug.aspx?PostID=416831\" width=\"1\" height=\"1\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Strategists at UBS Wealth Management believe the Canadian dollar still has room to grow, even though it has already gained 20% on its U.S. counterpart over the past year. Rising commodity prices and strong economic data is going to keep the dollar going, they said in a note to clients \u2013 just before Statistics Canada [&hellip;]<\/p>\n","protected":false},"author":4059,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-494170","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/494170","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/4059"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=494170"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/494170\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=494170"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=494170"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=494170"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}