USD/CAD gathers strength above 1.3850 as Fed remains in wait-and-see mode
The post USD/CAD gathers strength above 1.3850 as Fed remains in wait-and-see mode appeared on BitcoinEthereumNews.com.
USD/CAD gains momentum to around 1.3885 in Thursday’s early European session. Fed’s Powell signaled that central bank is in no hurry to move interest rates lower. BoC maintained its policy rate at 2.75% at its April meeting on Thursday. The USD/CAD pair strengthens to near 1.3885 during the early European session on Thursday. Hawkish remarks from Federal Reserve (Fed) Chair Powell and stronger Retail Sales provide some support for the Greenback. Trading volume is likely to be lightened ahead of the Good Friday holiday. The Fed’s Powell acknowledged on Wednesday that escalating tariffs could fuel inflation while undermining growth, complicating the path for interest rate decisions. Powell noted, “For the time being, we are well positioned to wait for greater clarity before considering any adjustments to our policy stance.” His comments reduced the likelihood of a Fed rate reduction in June, which lifts the US Dollar (USD) against the Canadian Dollar (CAD). The Bank of Canada (BoC) on Wednesday held the overnight rate unchanged for the first time since beginning its easing cycle last June. The BoC emphasized the weakening economic environment, including a deceleration in Canadian consumer and economic uncertainty. The markets had priced in a 50% chance that the BoC will return to easing at its next policy decision at the June meeting and expect two further reductions in total by year-end, according to a Bloomberg survey. Meanwhile, a recovery in Crude Oil prices could underpin the commodity-linked Loonie. It’s worth noting that Canada is the largest oil exporter to the US, and higher crude oil prices tend to have a positive impact on the CAD value. Canadian Dollar FAQs The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade…
Filed under: News - @ April 17, 2025 7:17 am