UBS sets USDCAD target rate at 1.34 for June 2026

Following the US administration's announcement of tariffs in April, the USDCAD exchange rate declined significantly toward levels seen just before the US election.

The recent election of Mark Carney as Prime Minister of Canada is expected to positively impact the currency's stability. Analysts at UBS predict that Carney's approach of accelerating trade negotiations with the US, coupled with pragmatic fiscal support, will stabilize the Canadian dollar.

The Bank of Canada is expected to gradually end its monetary policy easing cycle. This will benefit the Canadian dollar, as it could narrow the rate differential between Canada and the US over time. UBS anticipates that US trade and political news will continue to influence the movement of the currency pair.

UBS maintained its outlook on the USDCAD pair and introduced a new target of 1.34 for June 2026. This long-term target reflects the company's expectations for the currency pair over a multi-year time horizon. The forecast considers likely economic and political events that could affect the exchange rate in the coming years.