CAD: A strong hedge against energy risks – BBH
Brown Brothers Harriman’s (BBH) Elias Haddad expects Canada’s March labor force survey to show a modest job rebound, while the Bank of Canada (BoC) can use its benign inflation backdrop to look through the Oil shock. He notes that rate hike pricing has been trimmed and continues to favor long Canadian Dollar (CAD) crosses as a hedge against a more persistent energy price shock.
Jobs data and Oil dynamics support CAD
"March labor force survey is due on Friday. The economy is expected to add +14.9k jobs after losing -83.9k in February. Encouragingly, Canada’s favorable inflation backdrop gives the Bank of Canada (BoC) a small cushion to look through the oil-price shock and refrain from raising rates in the face of a worsening labor market."
"The swaps curve has trimmed BoC rate hike bets over the next twelve months from as much as 75bps on March 26 to around 50bps currently."
"We still favor long CAD on the crosses as a good hedge against a more persistent energy price shock. Canada gets the terms of trade boost and has fiscal space to absorb some of the growth drag to domestic demand."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Cardano Foundation unveils zero-knowledge series as ADA drops 2.8% to $0.1725
How much CPO demand will Nvidia Rubin Ultra generate? Bernstein: Optical value per Pod will increase fivefold
Bernstein believes that the co-packaged optics (CPO) and fiber demand driven by Nvidia's Rubin Ultra architecture will surge significantly, with the optical content per Pod rising from $1 million to $5.4 million. This will propel the size of Nvidia's optical ecosystem market to $46.8 billion by 2028 (a 91% annual increase). Although the industry faces supply bottlenecks with InP substrates, the outlook remains positive. The institution reiterates its “outperform” rating for Lumentum, Coherent, and Ciena.
UBS Q3 implements a two-way strategy with gold options, heavily invests in technology stocks, and builds positions in SK Hynix (SKHY.US)
UBS Group (UBS.US) has submitted its Q3 holdings report (13F) as of September 30, 2026.
SpaceX (SPCX.US) reportedly attempts “de-Nvidiaization” at the rack level: developing Kessel cabinets to bypass L6 compute boards, purchasing only chips
SemiAnalysis: SpaceX has developed its own Kessel cabinet, bypassing Nvidia's L6 cards to provide more options for manufacturing its own hardware.
Crypto prices
More
