Rosenberg Sees Further Weakness Ahead for Loonie Despite Bank of Canada Pause

08:30 AM EST, 11/11/2025 (MT Newswires) -- The near-term outlook for the Canadian dollar (CAD or loonie) will be driven by structural and cyclical weakness, despite the Bank of Canada's signaled pause and the productivity/investment-focused Canadian federal budget, said Rosenberg Research.

The BoC's hold will be short-lived based on an implied widening in the disinflationary output gap embedded in budget forecasts, noted Rosenberg.

Turning to Rosenberg's "Strategizer" model, which correctly identified reversal risks back in May -- when its Canadian dollar model score slumped to a four-year low -- it has since turned more neutral.

However, this isn't an upgrade in Rosenberg's model view to anywhere close to resembling a "buy," it stated. The fundamental story remains challenged.

Rather, the improved score is a function of Strategizer's prior success in flagging downside risks earlier in the year, with technicals and valuation subcomponents easing off their prior highs, added Rosenberg.

The more likely outcome in Rosenberg's view is that any anticipated takeoff in the loonie is to be delayed. Further declines are likely ahead and Rosenberg believes a move back toward C$1.45 is in the cards.

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