What the Canadian election this weekend means for CAD

This is via an ING note:

• Canada holds a federal election on 28 April amid a fierce debate on how to face Trump’s tariffs. Polls and betting odds project that Liberals, led by PM Mark Carney, will win with an absolute majority. This scenario is likely priced in by markets, and should have a limited short-term impact on CAD. A surprise Conservative win could instead trigger a CAD rally
• Based on latest polls, CBC projects Liberals will win 151-226 seats, with a central projection at 191, well above the 170 absolute majority threshold. Conservatives are projected around 94-156 seats, the Bloc Quebecois 12-29 and the New Democrats 0-18.

Re forecasts:

• Our USD/CAD projections currently embed a Liberal majority government as a baseline assumption.
• We expect the pair to trade at 1.39 at the end of 2Q, face some upside pressure in 3Q before starting a more structural downtrend from 4Q.

This article was written by Eamonn Sheridan at www.forexlive.com.