The new administration in Washington is pushing a pro-growth agenda, which we expect will further support the recent strength in the US dollar. Comments from the president and senior representatives of the new government have suggested some concern about the dollar’s level. We expect the dollar to remain relatively strong in the coming year, however.

Diverging monetary policy trends and asymmetric growth prospects suggest that the recent, wide swings in the USDCAD exchange rate are likely to continue in the second half of the year.