The Canadian Dollar has weakened sharply over this year and is now starting to break lower once again from recent consolidation against the US Dollar. This trend is likely to extend over the coming weeks as the Bank of Canada is widely expected to retain a cautious tone despite upside data surprises. Indeed, if oil continues to reverse lower this will put further pressure on CAD and give the BOC greater reason to highlight caution in their outlook, although oil prices have not been a dominant driver of CAD over recent weeks. The strongest factor influencing USDCAD at the moment remains the dovish stance of the BOC. (full story)