A note via Morgan Stanley Research
- maintains a bullish bias on CAD on the crosses, expressing that via holding a long CAD exposure against CHF.
- "We expect CAD gains as domestic COVID-19 cases continue to fall, rising global growth expectations support commodity prices, and economic activity outperformed BoC forecasts (and the market prices in a resulting QE taper)"
- "As enactment of fiscal stimulus approaches in the US, we expect US real yields to rise and breakevens to widen - an environment where CAD typically outperforms low yielders. We recommend short CHF/CAD positions"
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