USD/CAD is down 60 pips today to 1.3213
CIBC Research discusses its reaction to today's BoC policy statement.
"The Bank of Canada has taken itself out of the rate hike game, and its message today suggests that it isn't quite as sure about when it will come off the sidelines and hike again.
As we expected, the rate message wasn't that they were done for good, but rather, that the timing will be a bit more extended, adding the words "over time" to the paragraph that refers to the need to get rates into the neutral range. Growth for this year was revised to 1.7% (from 2.1%), but bumped up two ticks for 2020, but remember, that's likely under the assumption that interest rates won't have risen as quickly as in their last projection...," CIBC notes.
"With the Bank continuing to say that rates will have to rise to that range, the statement is more hawkish than what markets were pricing in, so the statement is bearish for fixed income markets and slightly bullish for the C$, CIBC adds.
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