Bank Of Canada: The Interest Rate Is Unchanged - 5.12.2012
On Wednesday morning, Asian markets had growth in quotes prevailed, among the leaders – Chinese stock indexes, supported by the Government statements of economic activity stabilization in China and by hopes of economic growth. However, the widely discussed “fiscal cliff” in the USA is restraining the investors’ optimism in the international financial markets. The US dollar keeps falling today vs. the most liquid currencies except Japanese yen, euro reached 7-weeks high at 1.3123. The US dollar index fell to its lowest level for the last six weeks at 79.56 (see the chart).
US dollar index, daily chart
Canadian dollar has been growing stronger vs. US dollar for the second day in a row, getting closer to the lower boundary of trading range, 0.9900-0.9950. The BOC meeting was finished yesterday. The Central Bank kept the interest rate unchanged at 1% (see the chart) in full accordance with market forecasts. Besides it, in spite of weak results for the 3(Q), the Central Bank expects the economic activity to increase in 2013 that may require "some tightening in monetary policy" as it was said in the Bank statement. The similar optimistic notes were noticed in results of the previous meeting held in October that was supporting the national currency.
Canada, overnight rate
Out of the upcoming macro statistics, we note the purchase prices index in Eurozone, coming at 10:00 CET, and the retail sales in the Currency Union at 11:00 CET. Attention is also should be paid to the USA statistics – the employment data from ADM at 14:15 CET, factory orders and non manufacturing sector activity index by ISM, at 16:00 CET.