The Canadian dollar advanced today after the Bank of Canada left its monetary policy unchanged. The currency was soft previously as retail sales data was rather negative.
The BoC left its main interest rate at 1 percent at today’s policy as was widely expected by analysts. The central bank said in the statement that the Canadian economy will not reach full capacity until 2016. Unlike the previous times, the bank did not mention that it “remains neutral with respect to the next change to the policy rate”. While this might be interpreted as sign of a close interest rate hike, most economists believe that the BoC will not raise borrowing costs anytime soon.
The press-conference that had been scheduled after the meeting was canceled. BoC Governor Stephen Poloz will testify later today.
The report about retail demonstrated a decline, while experts predicted an increase.
USD/CAD ticked down from 1.1219 to 1.1209 as of 17:00 GMT today following the rally to 1.1292. EUR/CAD dropped from 1.4267 to 1.4195. CAD/JPY rose from 95.34 to 95.68.
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