21 Jan 2015
USD/CAD consolidates near highs ahead of BoC
FXStreet (Córdoba) - USD/CAD consolidates right below the 1.2100 level, within a touching distance of 6-year highs, as investors adopt a wait-and-see stance ahead of the Bank of Canada monetary policy decision.
USD/CAD has oscillated in a narrow range over the last sessions after posting its highest level since April 2009 at 1.2113 and with the downside contained by the 1.2070 zone. At time of writing, the pair is trading at the 1.2095 area, 0.12% below its opening price.
Bank of Canada in focus
The Bank of Canada is broadly expected to keep its policy rate unchanged at 1.00% at today's meeting, although investors seem to have been pricing in a dovish stance, against a backdrop of low oil prices what has begun to take its toll on the Canadian economy.
"The focus will be on the extent of downwards revisions to growth and inflation following the collapse in the price of oil", said the TD Securities team. "The accompanying commentary will undoubtedly sound dovish, though market pricing towards easing is overdone".
According to TD analysts, pursuing a more aggressive policy response at this stage remains premature, so a message of caution fits with the Bank's generally dovish rhetoric reflected in recent public remarks.
USD/CAD has oscillated in a narrow range over the last sessions after posting its highest level since April 2009 at 1.2113 and with the downside contained by the 1.2070 zone. At time of writing, the pair is trading at the 1.2095 area, 0.12% below its opening price.
Bank of Canada in focus
The Bank of Canada is broadly expected to keep its policy rate unchanged at 1.00% at today's meeting, although investors seem to have been pricing in a dovish stance, against a backdrop of low oil prices what has begun to take its toll on the Canadian economy.
"The focus will be on the extent of downwards revisions to growth and inflation following the collapse in the price of oil", said the TD Securities team. "The accompanying commentary will undoubtedly sound dovish, though market pricing towards easing is overdone".
According to TD analysts, pursuing a more aggressive policy response at this stage remains premature, so a message of caution fits with the Bank's generally dovish rhetoric reflected in recent public remarks.