Bank of Canada (BoC) kept rates unchanged at 0.50 percent on Wednesday. The central bank downgraded its growth forecast for the Canadian economy in 2016 to 1.3 percent from a previous 1.7 percent. The BoC was less accommodating than expected and while it was recognized that the fall in commodity prices and its impact is still ongoing, it is optimistic that exports will resume in the second half of the year.
Governor Poloz during his press conference mentioned that the weak currency will help exporters but also warned that the recovery will not happen overnight. He admitted that its forecasts are cautious in its outlook for export, but the fact remains that Canada has not been able to reduce its dependence on natural resources as fast as the BoC would have wanted.
The opinion of the BoC on Brexit was discussed at the press conference with officials saying the impact of cost Brexit global growth of 0.2 percent and an impact of 0.1 percent for Canada, although it proceed in an orderly fashion. The central bank should wait in the wings until the effects of the fiscal stimulus package are felt in the second half of the year.
USD / CAD lost 0.364 percent in the last 24 hours. The pair is trading at 1.2988 after the Bank of Canada (BoC) left interest rates unchanged this morning. The loonie got a boost from central bank holding rates despite the oil price decline came after the release of US crude oil inventories.
The Report on monetary policy published quarterly by the central bank also gave an assessment of the negative impact of forest fires in Alberta. The disaster eroded 1.1 percent growth in Q2 carrying with it the expected growth and turn it into a contraction.
The Canadian currency has been boosted by the outlook less accommodative as governor Poloz continued optimism about a second half rebound.
The West Texas lost 3,775 percent in the past 24 hours. The pair is trading at $ 45.29 after US crude inventories fell less than expected. crude stocks at Cushing, Oklahoma, fell 2.5 million barrels last week. The International Energy Agency (IEA) said today that the glut of global supply is a threat to the recovery of the energy market.
CAD trades will be focused on data due Thursday, July 14 starts and sales of production due Friday. remaining macro events this week is the first Bank of England (BoE) rate statement from the historical Brexit vote Thursday and the release of US retail sales and inflation data on Friday
CAD events to watch this week :.
Thursday, July 14
8:30 CAD NHPI m / m
Friday, July 15
8:30 CAD manufacturing sales m / m
* All EDT
hours for a full list of events planned in the foreign exchange market check the economic calendar MarketPulse
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