- At 14:00 GMT, the Bank of Canada announces a monetary policy decision.
- Loonie loses strength before the central bank and due to the drop in oil.
- USD/CAD rises above 1.3200, approaches 2022 peak.
USD/CAD broke above 1.3200 in advance of the decision of the Bank of Canada. Added to the strength of the dollar was the weakness of the loonie before the BoC and the drop in oil prices. The barrel of WTI is at its lowest since February, losing more than 3%. A close of the pair above 1.3200 would be the highest since October 2020.
BoC is coming
The Bank of Canada will announce its monetary policy decision in minutes. The expectation is for a rise of 75 basis points, after having risen by 100 points in July. This occurs in a context of some moderation in economic activity and persistently high inflation.
The impact on looniesIf the expected decision is made, it will depend on the tone of the statement and the outlook for the future of monetary policy. USD/CAD awaits such a decision looking to 2022 highs at 1.3223. It is trading just above 1.3200, rising for the third day in a row.
The advance of the pair of these sessions is behind a stronger dollar. The DXY hit decades highs above 110.50. While the yields of Treasury bonds remain in the area of maximums in months.
Technical levels
Source: Fx Street
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