USD/CAD Edges Up as Bank of Canada Implements First Rate Cut Since 2022

Today's expected range for the Canadian Dollar against the major currencies:

US Dollar        1.3650-1.3750

Euro                 1.4850-1.4950

Sterling            1.7450-1.7550

WTI Oil (opening level) $74.23

USD.CAD is slightly higher this morning after yesterday's expected announcement that the Bank of Canada cut interest rates by a quarter point to 4.75%, this is the first interest rate cut since the Bank of Canada started increasing interest rates in March of 2022.

The Loonie reacted much like I thought it would as USD.CAD spiked to a high near 1.3740 (0.7278) before pulling back a little to open today at the 1.3690 (0.7304) level. Where the Loonie lost the most ground was to the other currencies with EUR.CAD and GBP.CAD both jumping over 100 points to close at new recent highs. The Loonie may recover a little against the Euro today as the ECB is expected to announce an interest rate cut of their own but that should also push the Greenback higher so our Dollar will find it difficult to garner any significant strength today.

Canadian economists seem to take comfort in comments from BOC Governor Tiff Macklem that inflation is under control and are now expecting another 2 interest rate cuts this year and possibly as many as 5 cuts next year. US Dollar buyers should continue to look to buy on any dips in the rate as the Loonie should remain trading with a weak bias.