USD/CAD is trading at a five-and-a-half year high ahead of tomorrow’s Bank of Canada decision in a 1.5 cent rally today. The bulk of today’s gain came after a soft manufacturing sales report but it’s been compounded by WTI crude down $2 to $46.68.
The Bank of Canada decision is the main driver, oil prices are down $22 since the Dec 3 BOC meeting and with disinflationary pressures building, the risk is that Poloz introduces a dovish bias tomorrow.
Technically, aside from overbought indicators, there’s no ceiling on the USD/CAD chart until 1.30.
USD/CAD weekly chart
I spoke with the CBC earlier today about the Bank of Canada and the Canadian dollar.
