BOC

USD/CAD drops to a fresh yearly low (1.3653) as the Bank of Canada (BoC) keeps the benchmark interest rate at 2.75%.

Surprises in growth and inflation have pushed the Bank of Canada into a corner, with markets now backing a hold in June. With USD/CAD bouncing at key technical support, the spotlight turns to Macklem’s post-decision tone for the next move.

Over the past four trading sessions, USD/CAD has depreciated by nearly 1.5% in favor of the Canadian dollar, as the market anticipates the upcoming Bank of Canada (BoC) rate decision.

The weakness in USD/CAD may persist ahead of the Bank of Canada (BoC) meeting as it extends the series of lower highs and lows from last week.

A blend of technical and macro factors has left the Canadian dollar at a crucial juncture ahead of next week’s BOC meeting. While USD/CAD holds support, a breakdown looms.

USD/CAD drops towards the monthly low (1.3829) as the Bank of Canada (BoC) keeps its benchmark interest rate at 2.75%.

USD/CAD may face increased volatility ahead of Canada’s federal election should the Bank of Canada (BoC) adjust the forward guidance for monetary policy.

USD/CAD has been showing neutral price action in the short term. Over the last five sessions, price fluctuations have barely reached a 0.5% variation, as the pair continues hovering around a key barrier near the 1.43289 level.

The USD/CAD maintains a slightly bullish bias, accumulating a gain of over 0.7% in the last five sessions, favoring the U.S. dollar.

USD/CAD has reversed off yesterday’s highs to trade back in the middle of its late-December through January range in the 1.4300-1.4500 zone on the BOC rate cut and latest tariff headlines.

Implied volatility for USD/CAD is slightly elevated over the next 24-hours, due to a Bank of Canada (BOC) rate decision and CPI figures from the US. But it could have been higher were it not for Canada bowing to Trump's threats over tariffs.