Bank of America considers Canada to be in the midst of a recession, and the short-term outlook for the Canadian dollar doesn’t bode well.
An article in The Province (link) indicates that the bank is the first to predict GDP contraction in the second quarter of 2015 in Canada, the second consecutive quarter of contraction. This may lead to another interest rate cut in Canada, which could weaken the Canadian dollar to about 70 cents compared to the U.S. dollar by the end of the year, according to the article.
The loonie has fallen in the past two weeks, dropping from around 82 cents to about 79 cents compared to the U.S. dollar.
Digital Access for only $0.99
For the most comprehensive local coverage, subscribe today.