FOMC befuddles and Kiwi gets squeezed
USDCAD Open 1.2545-50 Overnight Range 1.2514-60
Asia opened with traders trying to wrap their heads around the FOMC statement. Doves and hawks alike could find sentences to sink their talons into and the currencies responded in kind. That wasn’t the case for the RBNZ statement which was unequivocally doveish. Kiwi went south as did the Aussie on expectations that next Tuesday’s RBA meeting will offer up a similar statement.
USDCAD rose in sympathy with the antipodean moves but also because oil prices were soft and getting softer. Talk of another Bank of Canada rate cut in March and bullish technicals added to the bullish sentiment. The risk of weaker than expected Canada GDP on Friday (Forecast 0%) and the prospect of USDCAD demand on month end portfolio rebalancing will keep the focus to the top
The intraday USDCAD technicals are bullish while trading above 1.2485 looking for a break of minor resistance at 1.2565 to extend gains to 1.2635. A move below 1.2485 points to further weakness to 1.2440.
Today’s Range 1.2420-90