$USDC $USDC Strategic Bank of America (New York: BAC) Howard Du adjusted the short-term forecast for USD/CAD to 1.38, citing balanced market forces at play as the Canadian economy tries to overcome slowing growth, diverging monetary policy, and changing investor sentiment. In his semi-annual update, Du emphasized that the currency pair still faces 'two-sided short-term risks' as stronger-than-expected GDP figures and leading stock indicators offset soft signals from the Bank of Canada.

Markets are becoming increasingly pessimistic about Canada's economic outlook, expecting GDP to contract by 1% seasonally adjusted on a year-over-year basis in the second quarter. However, BofA forecasts a more moderate decline of only -0.2%, which aligns with the more constructive Scenario 1 from the Bank of Canada's April monetary policy report.