WorldWideMarkets Community

Forex Trading, Market News & Technical Analysis

Forex:  USDCAD Fell Sharply to 1.3225 after Bank of Canada Left Interest Rate Unchanged

Posted by Chris Advincula on Mar 10, 2016 4:12:33 AM


The USDCAD rate fell sharply from 1.3400 to 1.3225 (-175 pips) as the canadian dollar soared against the US dollar following the Bank of Canada's decision to leave their overnight interest rate unchanged at 0.5% (Wednesday 15:00 GMT). The USDCAD rate was confined to a narrow range in the prior Asian session and a small short covering rebound in Europe to 1.3280 Thursday 9:00 GMT as traders are staying on the sidelines ahead of the ECB monetary policy announcement later today at 12:45 GMT.

The Bank of Canada left their key lending rate unchanged at 0.5% as expected Wednesday 15:00 GMT. In their accompanying statement, the central bank repeats the risk to the inflation outlook is "roughly balanced" and the current monetary policy stance is appropriate. Near term economic outlook is unchanged and the 4th QTR GDP is not as weak as expected. Factors that pushed CPI above 2% is likely to unwind in the coming months, excess capacity will continue to dampen the core inflation. 

The canadian dollar continues to gain in Europe staying at the 1.3240 level with new highs in oil despite the US gulf crude stokpiles at record highs. Near-term support: 1.3245 - 14 DMA, 1.3230, 1.3162, 1.3125. Resistance: 1.3260, 1.3280, 1.3320.14-DMA 1.3390.

Topics: Canadian dollar, Bank of Canada, Forex Fundamentals, USDCAD


Tools & Educational Resources

Forex 101LEARN MORE >>
Learn the basics of Forex and how to practice trading the markets.

GlossaryLEARN MORE >>
Confused by the language? Click here and search for key trading terms.

Browse our frequently asked questions and find your answers right away.

Access to the educational lessons, webinars and platform walkthroughs.


Get started with a FREE $10,000 Demo Account and experience the Forex Market RISK FREE!