Canada: BoC to cut rates to 0.25% – TDS

FXStreet Team FXStreet

2020 is expected to be the weakest year for economic activity since at least 1982. Analysts at TD Securities look for the Bank of Canada (BoC) to cut rates to 0.25% before their next scheduled meeting in April.

Key quotes

“Media reports stating the more than 900,000 people filed for EI last week should make it clear that more easing is warranted. We look for the BoC to cut by 50 bps any day now.”

“We look for the BoC to announce $50-75bn worth of asset purchases at the April interest rate announcement.”

“We look for the cut to 0 bps in either April or June. A move to 10 bps is also within the realm of possibility.”

“We think that we need to see weakness extend into 2021 for the BoC to actually move rates into negative territory.”

Author

FXStreet Team

FXStreet

EUR/USD looks sidelined around 1.1850

EUR/USD remains on the back foot, extending its bearish tone and sliding towards the 1.1850 area to print fresh daily lows on Monday. The move lower comes as the US Dollar gathers modest traction, with thin liquidity and subdued volatility amplifying price swings amid the US market holiday.

GBP/USD flirts with daily lows near 1.3630

GBP/USD has quickly given back Friday’s solid gains, turning lower at the start of the week and drifting back towards the 1.3630 area. The focus now shifts squarely to Tuesday’s UK labour market report, which is likely to keep the quid firmly in the spotlight and could set the tone for Cable’s next move.

Gold battle around $5,000 continues

Gold is giving back part of Friday’s sharp rebound, deflating below the key $5,000 mark per troy ounce as the new week gets underway. Modest gains in the US Dollar are keeping the metal in check, while thin trading conditions, due to the Presidents Day holiday in the US, are adding to the choppy and hesitant tone across markets.

Bitcoin consolidates as on-chain data show mixed signals

Bitcoin price has consolidated between $65,700 and $72,000 over the past nine days, with no clear directional bias. US-listed spot ETFs recorded a $359.91 million weekly outflow, marking the fourth consecutive week of withdrawals.

The week ahead: Key inflation readings and why the AI trade could be overdone

It is likely to be a quiet start to the week, with US markets closed on Monday for Presidents Day. European markets are higher across the board and gold is clinging to the $5,000 level after the tamer than expected CPI report in the US reduced haven flows to precious metals.

XRP steadies in narrow range as fund inflows, futures interest rise

Ripple is trading in a narrow range between $1.45 (immediate support) and $1.50 (resistance) at the time of writing on Monday. The remittance token extended its recovery last week, peaking at $1.67 on Sunday from the weekly open at $1.43.