BOC Keeps Rates on Hold Again
The BOC kept interest rates unchanged at 0.25%
Skerdian Meta•Thursday, September 10, 2020•1 min read
The Bank of Canada (BOC) held its meeting yesterday. This time, there were no expectations of a rate cut, from the 0.25% benchmark that was set in March. But the Canadian economy is showing signs of weakness, similar to what we have been seeing in Europe in the last two months, so the BOC was expected to turn slightly dovish today, acknowledging the recent weakness. The USD/CAD has turned bullish in the last two days, climbing more than 200 pips, as crude oil crashes lower.
Highlights of the Bank of Canada rate decision
- No change in the 0.25% overnight rate, as expected
- Both the global and Canadian economies are evolving broadly in line with the scenario outlined in July
- The rebound in the United States has been stronger than expected, while the economic performance among emerging markets has been more mixed
- The BOC continues to expect the recuperation phase to be slow and choppy, as the economy copes with ongoing uncertainty and structural challenges.
- The CPI is expected to remain well below target in the near term
- Reaffirmation that the BOC “will hold the policy interest rate at the effective lower boundary until economic slack has been absorbed, so that the 2% inflation target is sustainably achieved”
- There is hardly anything new here. There were no changes in the BOC policy, and the language on forward guidance is entirely unchanged. There are some CAD bids waiting in the wings until after the decision, as it plays catch-up with the other commodity currencies. I expect more of that in the minutes ahead.
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
ABOUT THE AUTHOR
See More
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.
Related Articles
Comments
Subscribe
Login
Please login to comment
0 Comments
Oldest
Sidebar rates
Related Posts
Save
Join 350 000+ traders receiving Free Trading Signals
Alerts
Rates
Calendar
Signals