FXStreet (Delhi) – Research Team at TDS, note that the USDCAD price action may become more benign with no major policy catalyst (Fed or BoC) on the near-term horizon. Key Quotes “Manufacturing sales is the major data point in Canada this week and we are looking for a sharp decline by 2.8% m/m. That may keep USDCAD biased to the upside as it may reinforce the notion that the CAD will need to remain weak to offset the negative shocks in the economy. But, even though we see some bias to the upside later this week, we do not think there will be much room for USDCAD to rally with the Bank meeting scheduled for next week.” “We do not anticipate much of a change in tune as it remains premature to become optimistic on some signs of a recovery from the oil shock. Moreover, the Business Outlook Survey from last Friday suggested a modest improvement in future sales and capex but still a lot of caution and dependency on a weak currency. From that perspective, the BoC has no incentive to sound upbeat. But, we will receive a fresh update in economic forecasts, where we see upside risks to the second half forecast (our Q3 GDP tracking sits around 2.5% compared to the BoC’s 1.5%).” “Our fair value estimate has not changed much at all from yesterday and sits at 1.2882. We view a dip to the 1.28/1.29 area as a buying opportunity but as we noted above we do not see much upside potential with no major policy catalyst.” For more information, read our latest forex news.