Loonie Set to Gain as Fed Cuts and Canada Slows Easing Cycle

Canada’s currency is poised to benefit from a smaller interest-rate gap with the US as the nation’s central bank nears the end of its monetary easing cycle while the Federal Reserve gears up for multiple cuts.

The so-called loonie has become an attractive option to buy versus the dollar, with firms such as JPMorgan Chase & Co. and BMO Global Asset Management targeting the 1.35-1.36 level by year-end, compared with 1.3769 on Monday afternoon in New York. A lower level means the loonie has strengthened.