USDCAD Movement
For the 24 hours to 23:00 GMT, the USD rose 0.82% against the CAD to close at 1.0001, after the Bank of Canada (BoC) lowered its economic estimates and indicated that it would probably keep interest rates unchanged longer than previously thought.
Yesterday, the Bank of Canada kept interest rates unchanged at 1.0% and lowered its growth forecast for 2013 indicating that there is greater slack in the economy, with inflation now seen returning to the 2% target in the second half of 2014 instead of the end of 2013. Moreover, the Bank of Canada Governor, Mark Carney stated that the need to raise interest rates is less urgent because the economy would take longer to reach full output, keeping inflation below target until the second half of next year.
Separately, Teranet/National Bank reported that Canadian home prices fell 0.4% (MoM) in December, against the expectations for a 0.3% drop.
In the Asian session, at GMT0400, the pair is trading at 1.0003, with the USD trading marginally higher from yesterday’s close.
The pair is expected to find support at 0.9934, and a fall through could take it to the next support level of 0.9865. The pair is expected to find its first resistance at 1.0039, and a rise through could take it to the next resistance level of 1.0075.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.
