The Canadian dollar fell versus its US counterpart today after the Federal Open Market Committee decided to keep its monetary policy unchanged. The currency gained on other major rivals thanks to the rally of crude oil prices.
The FOMC left the federal funds rate in the range of 0.75%-1%, exactly as market participants were expecting. The Committee made some hawkish remarks in its statement, leading many analysts to claim that the Federal Reserve is preparing to lift interest rates in the near future. Currently, CME FedWatch shows about 75% probability of a rate hike in June.
Crude oil prices gained today, lending strength to the Canadian currency, as US inventories of crude demonstrated a decline last week. Now, traders wait for tomorrow’s report about Canada’s trade balance and Friday’s employment data from Canada and the United States.
USD/CAD ticked up from 1.3707 to 1.3718 as of 19:42 GMT today. EUR/CAD slid from 1.4980 to 1.4936. CAD/JPY gained from 81.65 to 82.15.
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