The Canadian Dollar exchange rate complex is higher thanks to a cautious BoC and strong commodity complex, but the risks of a fresh lurch lower remain a distinct possibility. The Canadian dollar (CAD) is picking fresh bids in sympathy with a rampant Australian dollar; the commodity currency complex is having a good day and while CAD may not be steaming ahead it is benefiting nevertheless. Gains against the pound sterling are being witnessed as a longer-term trend higher in GBP-CAD wanes. Of course there is also yesterday's BoC event to thank. Either way, the CAD looks as follows: Beware: The selling may not be over yet Despite recent gains in the rate we must stay mindful to longer-term forecasts that suggest further losses in CAD can be expected into mid-year. Against the pound sterling the CAD may reach 1.87 and against the Euro a rate of 1.49 is predicted. In addition, short-term pressures may also reappear according to Stephen Gallo at BMO Capital who considers the headline US dollar / Canadian Dollar exchange rate: "Very recent price action in USD/CAD suggests that the short-CAD covering we had been highlighting as a factor since the start of the week has been reserved until after the BoC. "Our hunch is that it’s not entirely finished yet. So although we do expect very good support 1.095-1.1025, a very weak US employment report tomorrow will put the USD quickly on the defensive versus the CAD."

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