We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
USD/JPY
Bearish
Gold
Bullish
Oil - US Crude
Bearish
Bitcoin
Bearish
More View more
Real Time News
  • The Australian Dollar and New Zealand Dollar tend to rise with stocks. They have recently fallen despite gains in the #SP500. What does this mean for $AUDUSD and $NZDUSD ahead? #AUD #NZD #RBA #RBNZ - https://www.dailyfx.com/forex/fundamental/article/special_report/2020/01/17/AUDUSD-NZDUSD-Outlook-Looks-Past-Stocks-to-Rate-Cut-Bets.html?CHID=9&QPID=917702 https://t.co/ddf2fV7Kyl
  • A few snippets from today's commentary. Check out the link below for the full story (via @DailyFX). https://t.co/I31tuq764r https://t.co/x0BaiOFA1P
  • Have you joined @DailyFX @facebook group yet? Discuss your #forex strategies and brush up on your skills with us here: https://t.co/jtY1G7g8yx https://t.co/e2YrN3dBrl
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 98.00%, while traders in France 40 are at opposite extremes with 79.59%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/UL7hqSD2Ki
  • US Dollar Forecast: $USD Lacking Impetus Ahead of Consumer Sentiment #Forex traders shift focus away from US-China trade deal headlines - perhaps toward the monthly release of #ConsumerSentiment data for volatility and clues on the Greenback's next move https://www.dailyfx.com/forex/fundamental/us_dollar_index/usd_trading_today/2020/01/16/us-dollar-forecast-usd-lacking-impetus-ahead-of-consumer-sentiment.html
  • Forex Update: As of 05:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.11% 🇦🇺AUD: -0.02% 🇯🇵JPY: -0.03% 🇨🇭CHF: -0.05% 🇬🇧GBP: -0.06% 🇨🇦CAD: -0.07% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/Kxcb9EtIWb
  • Indices Update: As of 05:00, these are your best and worst performers based on the London trading schedule: Germany 30: 0.45% France 40: 0.26% Wall Street: 0.07% US 500: 0.00% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/I5YIsKQAog
  • 🇯🇵 JPY Tertiary Industry Index (MoM) (NOV), Actual: 1.3% Expected: 1.0% Previous: -5.2% https://www.dailyfx.com/economic-calendar#2020-01-17
  • The $JPY has weakened as a bounce-back in risk appetite saps haven-asset demand. However, the old uptrend line still provides clear resistance. Get your market update from @DavidCottleFX HERE:https://t.co/IMhgQ9jbF9 https://t.co/I7087olftk
  • Heads Up:🇯🇵 JPY Tertiary Industry Index (MoM) (NOV) due at 04:30 GMT (15min), Actual: N/A Expected: 1.0% Previous: -4.6% https://www.dailyfx.com/economic-calendar#2020-01-17
Loonie Surges as Bank of Canada Holds Rate at 1.00%

Loonie Surges as Bank of Canada Holds Rate at 1.00%

2012-03-08 16:42:00
Trang Nguyen,
Share:

THE TAKEAWAY: Central Bank Holds Key Rate at 1 percent > The Outlook for Canadian Economy Has Improved and Inflation Expectations Has Been Well-Anchored> Canadian Dollar Gains

At the monetary policy meeting today, the Bank of Canada announced its decision to hold the key interest rate at 1.00 percent for the twelfth time in a row, extending its longest pause since the 1950s. The target rate has left unchanged since September 2010, after seeing three consecutive 25 basis points increases from 0.25 percent. Bank of Canada’s rate decision came in with no surprise as it matched with twenty-eight economists’ projections from Bloomberg survey. The Bank Rate is correspondingly 1.25 percent and the deposit rate is 0.75 percent.

The Bank cited “marginally improved outlook for Canadian economy” and “well-anchored inflation expectations” as the main reasons to keep the key rate on hold. Since the Bank released its January Monetary Policy Report (MPR), the global economic outlook has improved and uncertainty has reduced as European bank funding and sovereign debt markets showed signs of stabilization. Given enhanced global economic conditions, rising commodity prices and strong private demand, the Bank sees faster-than-expected growth in the first quarter. In January, the bank had predicted growth averaging 1.8 percent for the first half of this year. Besides, Canadian inflation is somewhat “firmer than previously anticipated” due to reduced economic slack and higher oil prices. Core inflation is expected to be around 2 percent over the forecast horizon.

The Bank also said in its statement that “persistent currency strength” of the Canadian dollar has been an ongoing challenge for the world’s tenth largest economy as this would dampen foreign demand and negatively affect net exports. “With the target interest rate near historic lows and financial system functioning well, there is considerable monetary policy stimulus in Canada”. Regardless, policy makers continued to endorse wait-and-see approach while noting that recent fundamental evidences point to better outlook than projected a couple of months ago.

USD/CAD 1-minute Chart: March 8, 2012

030812_Canadian_central_bank_rate_decision_body_Picture_1.png, Loonie Surges as Bank of Canada Holds Rate at 1.00%

Charts created using Strategy Trader– Prepared by Trang Nguyen

In the minutes following the Bank of Canada rate decision, the Canadian currency immediately gained ground versus its major currencies. As can be seen from the 1-minute chart above, the USDCAD pair dropped approximately 50 pips from 0.9955 to 0.9915 within ten minutes. The Relative Strength Indicator crossing below the 30-level, an oversold territory, signaled that currency traders were aggressively selling the greenback in favor of the loonie. Obviously, improved prospect for Canadian economy indicates interest rates could hike again sooner rather than expected earlier that would attract more foreign investors looking for high-yield returns on their investments. At the time this report was written, the Canadian dollar was traded at $0.99275

--- Written by Trang Nguyen, DailyFX Research Team for DailyFX.com

To contact Trang, email tnguyen@dailyfx.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.