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Bank of Canada hiked its overnight rate to from 1.25% to 1.50% yesterday. Rate statement was more hawkish that many expected and the initial reaction was to buy Canadian dollars, with USD/CAD quickly testing support at 1.3060. However, a strong round of broad U.S. dollar buying followed, which took the pair 150 pips higher.
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Canadian dollar rallies on BOC, reverses on tariffs
Bank of Canada caught many off guard on Wednesday. The bank kept overnight rate unchanged at 1.25% but released a hawkish statement, that now puts July hike firmly on the table. However, trade wars continue with steel and aluminium tariffs, which is a headwind for Canadian dollar. USD/CAD 1.30 is the bull/bear line in sand.
USD/CAD a bit higher after the BOC
Bank of Canada left overnight rate at 1.25%, as widely expected. They see higher rates over time but will proceed with caution. USD/CAD jumped, found resistance at 1.265 and then stabilized about 75 pips above pre-release levels. The pair's currently trading right at 200 DMA and above the initial support at 1.26.
Bank of Canada hikes, Canadian dollar whipsaws
Bank of Canada hiked overnight rate for the third time in this cycle. Market reaction was messy. There appears to have been a leak which prompted sell-the-fact trade about 20 seconds before the release. Price then whipsawed in a 150-pip range before settling in the middle. 1.24 is the initial support, 1.25 the resistance.
CAD bulls forced to cover after not-so-hawkish BOC
Bank of Canada keeps overnight rate at 1.0%. They were upbeat on the economy but expressed caution as regards further normalization of the policy. Market was caught wrong-footed, appears to have been priced for a more explicit forward guidance in light of recent GDP and labour market reports. 1.2625 - 1.2925 range remains in play.
USD/CAD rallies as Bank of Canada expresses caution
BOC decided to leave overnight rate at 1.0% at today's meeting. GDP forecasts were revised slightly lower while CPI forecasts were just marginally bumped up. The bank expressed concern with regard to geopolitical developments, NAFTA and high levels of household debt, and said they will be cautious in making future adjustments to the rate.
The fact that such a scenario was widely anticipated didn't help the Canadian dollar. After a quick washout to 1.2635, USD/CAD jumped 100 pips, added 80 more i…
The fact that such a scenario was widely anticipated didn't help the Canadian dollar. After a quick washout to 1.2635, USD/CAD jumped 100 pips, added 80 more i…
BOC holds rates
Contrary to what many expected, BOC held the overnight rate at 0.50%. Canadian dollar weakened a lot in anticipation of their move and was bought heavily after the decision.
The pair (USD/CAD) was marked down immediately but it turned around swiftly and retested pre-meeting range in anticipation of a dovish press conference. That never came and the pair continued lower, leaving a big reversal candle on the daily chart.
The pair (USD/CAD) was marked down immediately but it turned around swiftly and retested pre-meeting range in anticipation of a dovish press conference. That never came and the pair continued lower, leaving a big reversal candle on the daily chart.