CAD/DKK Outlook:
Slightly positive, but likely to move sideways, as the CAD trades just above its recent average amid rising oil prices.
Key drivers:
• Rate gap: The Bank of Canada's cautious stance contrasts with Danmarks Nationalbank's earlier rate cut, affecting CAD positively against a weakening DKK.
• Risk/commodities: Oil prices remain strong, trading near 90-day highs, providing ongoing support for the CAD as Canada benefits from its oil export revenues.
• One macro factor: Increasing trading volumes for the DKK indicate heightened market activity, but this adds uncertainty to its stability against the CAD.
Range:
Expect the CAD/DKK to hold steady within its recent range, potentially drifting as other factors fluctuate.
What could change it:
• Upside risk: A significant increase in oil prices could further bolster the CAD.
• Downside risk: Any escalation in US-Canada trade tensions might put downward pressure on the CAD.