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USD/CAD Jumps Higher on Dovish BOC Statement

The Bank of Canada is holding its usual meeting today. They released the rate decision and the monetary policy statement that comes with it. As anticipated, the BOC left interest rates unchanged at 1.75%. But, the statement seemed more dovish, compared to the one in January. Here are a few takes from the MonPol Statement:

  • Global economic growth has slowed by more than the Bank forecast in its January Monetary Policy Report (MPR).
  • Ongoing uncertainty related to trade conflicts has undermined business sentiment and activity, contributing to a synchronous slowdown across many countries
  • Global economic activity is expected to pick up during 2019 and average 3 ¼ per cent over the projection period, supported by accommodative financial conditions and as a number of temporary factors weighing on growth fade.
  • In Canada, growth during the first half of 2019 is now expected to be slower than was anticipated in January.

As you an see, a lot of dovish comments. There were some hawkish ones too but they are more like expectations of what the BOC hopes to happen in the future, while the dovish comments are actual. USD/CAD jumped 80 pips higher to 1.35 20 on those comments, so now the range of the past month between 1.33 and 1.34 is history. Although, chairman Poloz is coming out to hold a press conference soon, so keep an eye on him if you are trading the CAD.

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Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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