The Canadian dollar jumped to the highest level in more than two years against the euro as the Forex market was positioning itself for tomorrow’s monetary policy meeting of the European Central Bank.
Most FX markets participants believe that the ECB would cut its interest rates tomorrow. Economists also expect that the central banks of the United States and China would also ease their monetary policies. Crude oil, the major export of Canada, rallied on such expectations, jumping as much as 5.1 percent to $88.04 per barrel in New York.
Today was Independence Day in the USA, meaning that trading was more sluggish that usual. Tomorrow, though, the trading session is likely to be much more interesting. Both the ECB and the Bank of England will announce their monetary decisions, which should affect markets tremendously.
EUR/CAD was down from 1.2760 to 1.2687 as of 23:33 GMT today, touching earlier 1.2661 — the lowest rate since June 23, 2010. USD/CAD rose a little from 1.0120 to 1.0134, while CAD/JPY was flat at 78.80, demonstrating the sluggishness of today’s session.
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