Deutsche, JPMorgan See Weaker Canadian Dollar as Inflation Cools

Deutsche Bank and JPMorgan are increasing bearish wagers on the Canadian dollar for 2026 as tame Canadian inflation is prompting a rethink of the Bank of Canada’s rate-hike outlook. The article points to weaker policy expectations supporting downside pressure on CAD, with positioning and FX derivatives likely to remain in focus. The news is negative for the currency but remains a market positioning story rather than a macro shock.

Analysis

Deutsche Bank and JPMorgan are increasing bearish wagers on the Canadian dollar for 2026 as tame Canadian inflation is prompting a rethink of the Bank of Canada’s rate-hike outlook. The article points to weaker policy expectations supporting downside pressure on CAD, with positioning and FX derivatives likely to remain in focus. The news is negative for the currency but remains a market positioning story rather than a macro shock.