Loonie strengthens ahead of January rate hike
|Later today the Bank of Canada (BoC) will announce its December interest-rate decision: we think it will remain unchanged, but a climb is likely in January. USD/CAD has tracked front-end yield spreads tightening in the last six months. With a US Federal Reserve December rate hike priced-in and a hawkish BoC, a USD/CAD reversal from 1.29 resistance presages a deeper correction towards 1.2566 (100-day moving average).
Stay on top of the markets with Swissquote’s News & Analysis
Q3 economic data surprised to the upside. Labour markets exceeded expectations, demand was strong, and the prospect of US tax reform could accelerate Canadian growth and reduce risk of the North American Free Trade Agreement falling apart. The BoC is likely to hike rates steadily, in a gradual process.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.