Loonie Gains on Expectations of Higher Interest Rates
The Canadian dollar was higher today as the central bank reiterated its suggestion that interest rates should be higher in the future. That suggestion opposed the comments of bank’s Governor Mark Carney, who was less hawkish.
Carney said at yesterday’s press conference that “the case for adjustment of interest rates has become less imminent”. Such comments contrasted to Bank of Canada’s Monetary Policy Report that repeated the words of the policy statement:
Over time, some modest withdrawal of monetary policy stimulus will likely be required.
Yesterday, Governor’s outlook prevailed, bringing the loonie down. Today, traders turned bullish again.
USD/CAD declined from 0.9933 to 0.9914 and EUR/CAD dropped from 1.2880 as of 11:52 GMT, following the previous advance from 1.2886 to 1.2919.
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Earlier News About the Canadian Dollar:
- Bank of Canada Remains Hawkish, Loonie Goes Higher (2012-10-23)
- Loonie Struggles against other Majors (2012-10-22)
- Loonie Declines to Lowest in Several Months on Poor CPI Growth (2012-10-19)
- Canadian Dollar Hurt by Flaherty's Comments (2012-10-19)
- Canadian Dollar Snaps Three-Day Drop (2012-10-18)