Who would have expected the once lowly (just a few hours ago…) Canadian dollar to spark a dollar slide across the board? Looks like the market had gotten well-long of USD/CAD in anticipation of a rate cut and is now wearing them or has pitched them at much lower levels. Dealers report a Swiss name very aggressively hitting bids for the first 50 pips of the slide, probably for a fund client. Reports of Canadian real-money accounts hitting bids have also been heard. USD/CAD is better than a cent lower in the wake of the no-change announcement and nearly 2 cents below session highs, now at 1.0595.
EUR/USD squeezed into the 1.4480s on short-covering as hedge funds and central banks bought EUR/USD agressively in early New York trade.
For those interested, here is the full statement from the BOC.
