USD/CAD drops to lows near 1.3250 post-BoC

The Canadian dollar is now gathering further traction vs. its neighbor, sending USD/CAD to the area of daily lows around 1.3250.

USD/CAD weaker on steady BoC

CAD met a wave of buying orders after the Bank of Canada kept its monetary conditions intact at today’s meeting, leaving the repo rate unchanged at 0.50% and matching precious estimates.

The statement said that global economic conditions remain solid, although uncertainty has grown bigger. The BoC has also noted the upside momentum in Canadian yields following the recent presidential elections in the US.

The central bank argued that domestic growth rebounded in Q3 after a weak first half of the year, although it expects a more moderate growth in the October-December period.

The BoC emphasized the improvement in the labour market although it still sees a ‘significant amount of slack’ in the economy.

Regarding inflation, the statement noted the recent pick up, but it is yet below estimates.

USD/CAD significant levels

As of writing the pair is losing 0.18% at 1.3253 and a breach of 1.3231 (low Dec.5) would open the door to 1.3193 (100-day sma) and finally 1.3066 (200-day sma). On the flip side, the next resistance lines up at 1.3311 (38.2% Fibo of the 2016 drop) followed by 1.3357 (high Dec.5) and then 1.3429 (20-day sma).