Canadian Dollar: "Happiness was so close"
22.01.2015
The decision of the Bank of Canada to lower interest rates allowed the USD/CAD pair to "fly" to new highs.
It turns out that the Bank of Canada is quiet a joker. The market was not expecting a trick from yesterday’s completely ordinary meeting of the regulator. But the decision was made and announced: the interest rate is lowered to 0.75% from 1.0%.
The comments from the Bank of Canada explained that low oil prices are clearly negative for the economy, and core inflation will be under the gun. Overall inflation in the second quarter of 2015 will be reduced to 0.3%, and core inflation should remain around 2%. Expectations for GDP growth for 2015 have deteriorated to 2.1% from 2.4%, and the forecast for 2016, in contrast, improved to 2.4% from 2.3%.
The Bank of Canada is waiting for a small price increases in "black gold" in the medium term, and the forecast assumes the achievement of $ 60 per barrel.
Investment in fixed assets are low and the Canadian economy can only return to the full load by the end of this year with the implementation of the most favourable scenario.
Naturally, the Canadian dollar could not "survive" such a hit. The USD/CAD pair went to multi-month peaks at 1.2393. Today's trading was held in low volumes, with average activity. In general, for now the prospects for the Canadian dollar are not the most impressive.
RoboForex Analytical Department
It turns out that the Bank of Canada is quiet a joker. The market was not expecting a trick from yesterday’s completely ordinary meeting of the regulator. But the decision was made and announced: the interest rate is lowered to 0.75% from 1.0%.
The comments from the Bank of Canada explained that low oil prices are clearly negative for the economy, and core inflation will be under the gun. Overall inflation in the second quarter of 2015 will be reduced to 0.3%, and core inflation should remain around 2%. Expectations for GDP growth for 2015 have deteriorated to 2.1% from 2.4%, and the forecast for 2016, in contrast, improved to 2.4% from 2.3%.
The Bank of Canada is waiting for a small price increases in "black gold" in the medium term, and the forecast assumes the achievement of $ 60 per barrel.
Investment in fixed assets are low and the Canadian economy can only return to the full load by the end of this year with the implementation of the most favourable scenario.
Naturally, the Canadian dollar could not "survive" such a hit. The USD/CAD pair went to multi-month peaks at 1.2393. Today's trading was held in low volumes, with average activity. In general, for now the prospects for the Canadian dollar are not the most impressive.
RoboForex Analytical Department
Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.