The Canadian dollar fell today as Forex traders were weighing chances for the US Federal Reserve to taper its monetary stimulus at this week’s policy meeting. The losses were not particularly big as the market was somewhat quiet ahead of the gathering.
The Fed meets on Wednesday and all attention is focused on the upcoming event. Signs of recovery in the United States allow economists to speculate that the US central bank may trim the size of the stimulus program.
At the same time, the Bank of Canada has become much less hawkish after Mark Carney left the post of Governor (and the bank itself) in June 2013 and does not talk much about possible tightening of monetary policy. It is not surprising considering that economic data suggest that Canada’s economy is struggling to maintain growth. This led to the drop of the loonie and even rising prices for crude oil, the major Canadian export, did not help the currency.
USD/CAD was up from 1.0589 to 1.0594 as of 23:38 GMT today following the drop to 1.0571. EUR/CAD rose from 1.4539 to 1.4576, reaching the high of 1.4613. CAD/JPY declined from 97.48 to 97.24, touching the daily low of 96.93 during the trading session.
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