BOC Undermines Canadian Dollar

The Bank of Canada interest rate decision is clearly a short-term negative factor for the Canadian currency. The downbeat economic assessment also shows that there is a lack of confidence in US and global growth prospects given the Canadian dependence on trade. The Canadian outlook, therefore, is also likely to…

Canada Goes Japanese

Canada’s decision to target monetary reserves of C$ billion is textbook “quantitative easing” (not only credit easing), which is the way the Bank of Japan announced policy easing in 2002-04. Canadian dollar damaged across the board as the Bank of Canada is the latest central bank to dive into quantitative…

Bank of Canada Cuts Target Rate by 25 Basis Points

The Bank of Canada cut the target for the overnight rate by 25 basis points to 0.25%, citing a deeper-than-expected recession in Canada and the fact that “measures to stabilize the global financial system have taken longer than expected to enact”. Markets were evenly split on whether the Bank would…

Commodity Dollars Creeping Higher

A largely unexpected cut leaving Canada’s benchmark rate on a par with the top of the range of the fed funds rate and growing fears over the possibility of backdoor nationalization of some U.S. banks hurt risk appetite earlier today. The dollar in early morning trade has taken a breather…

Pound and Euro Are Fighting Back?

After the Asian session finished down more than 200 points, stocks have traded negatively, as has Europe amid poor bank earnings results, giving investors more reasons to worry about the economic future. All of this is despite the confidence we witnessed during recent days, mainly because traders know the worst…

Tuesday Forex Crawl After Sunday/Monday Sprint

The Tuesday U.S. session has left as many questions as answers in regard to the next leg of Usd strength or weakness. “The dollar index is at major resistance at 87.00, and will need negative equity markets that lead to a move to bonds and Treasury notes for that area…

CAD Eases on Surprise BoC Cut

The Bank of Canada announced the results of its monetary policy deliberations this morning, unexpectedly cutting its benchmark lending rate by 25-basis points to 0.25%, a record low. The BoC acknowledged that “the recession in Canada will be deeper than anticipated, with the economy projected to contract by 3.0% in…