FINWIRES · TerminalLIVE
FINWIRES

Canadian Dollar Recovery Hinges on Broader Economic Strength, Not Oil Prices, Commerzbank Says

By

The Canadian dollar's medium-term recovery will likely depend less on oil prices and more on whether the broader economic recovery can be sustained, according to Commerzbank Research in a Thursday note.

Recent data suggested the recovery was already underway before the US-Iran conflict and wasn't mainly driven by higher energy prices, said Commerzbank.

Real energy exports have been rising steadily since last summer. At the same time, the labor-market recovery has been driven mainly by services rather than the relatively small energy sector, added the bank. Stronger PMIs, exports and overall growth also suggest that US tariff uncertainty is easing.

Oil prices remain an important short-term driver of the Canadian dollar, but US-Canada trade talks will matter more for the currency's medium-term outlook, according to Commerzbank.

"It is only once the Canadian real economy has recovered sustainably that the Bank of Canada is likely to consider interest rate hikes, and it is only then that the CAD is likely to recover," wrote Commerzbank FX Analyst Michael Pfister in the note.

Related Articles

Mining & Metals

Stantec Q2 Adjusted Earnings Climbs 18%

Stantec (STN.TO) said Wednesday after trade that adjusted earnings jumped 18.4% to C$1.61 per share, from C$1.36 per share, in the prior year period.Analysts polled by FactSet had expected C$1.58 per share.Net revenue increased 11.5% year over year to C$1.8 billion, in line with analysts' expectation of C$1.8 billion.The increase was driven by acquisition growth of 7.1%, and organic growth of 3.7%, the company said.Stantec also reaffirmed its fiscal 2026 net revenue growth outlook of 8.5% to 11.5%, and adjusted earnings growth of 15% to 18%. Its adjusted EBITDA target range is between 17.8% to 18.3%."As reflected in Stantec's second quarter results, strong operational performance, combined with solid growth in our Global region and meaningful contributions from our acquisition of Page, have kept us on track to deliver on our 2026 financial targets," said Chief Executive Gord Johnston."The long-term demand drivers of our business remain intact, and with a record backlog of $9.2 billion, we expect to see an acceleration of activity in the second half of 2026."Stantec will pay a regular quarterly dividend of C$0.245 per share, payable on Oct. 15, to shareholders of record on Sept. 29.Stantec shares closed down C$0.22, to C$103.55, on the Toronto Stock Exchange.

$STN.TO
Mining & Metals

Earnings Flash (TGO.TO) TERAGO Inc. Reports Q2 Revenue C$6.2M

$TGO.TO
Mining & Metals

CAE's Fiscal Q1 Adjusted Earnings Remain Unchanged; Revenue Rises; Fiscal 2027 Outlook Kept

CAE (CAE.TO) after trade Wednesday reported fiscal first-quarter adjusted earnings per share of C$0.26, unchanged from a year ago.Analysts polled by FactSet expected C$0.23.Revenue for the quarter ended June 30 rose to C$1.17 billion from C$1.10 billion a year earlier.Analysts polled by FactSet expected C$1.13 billion.The company said its fiscal 2027 outlook remains unchanged. It continues to expect low-single-digit percentage revenue growth and adjusted EPS of C$1.21 to C$1.28.

$CAE.TO