The Canadian central bank left its interest rates stable during the Wednesday’s policy meeting, surprising no one. The Canadian dollar jumped as a result and kept its gains during the early Thursday’s trading hours.
Unlike the Reserve Bank of New Zealand, the BoC did not provide any surprises to the market, leaving its key interest rate at 0.5%. The bank sounded rather confident in the state of the global economy:
The global economy is progressing largely as the Bank anticipated in its January Monetary Policy Report (MPR). Financial market volatility, reflecting heightened concerns about economic momentum, appears to be abating. Although downside risks remain, the Bank still expects global growth to strengthen this year and next.
Additionally, the BoC mentioned the recent bounce of crude oil prices:
Prices of oil and other commodities have rebounded in recent weeks.
Indeed, the rise of crude oil on Wednesday also contributed to the loonie’s strength.
USD/CAD dropped 1.2% from 1.3409 to 1.3246 yesterday and traded at about 1.3270 as of 1:18 GMT today. EUR/CAD declined 1.3% from 1.4763 to 1.4567 on Wednesday and remained close to that level during the current trading session. CAD/JPY also did not move far after rallying 1.8% from 83.98 to 85.49 during the Wednesday’s session.
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