Canadian dollar advances ahead of Bank of Canada interest rate announcement | iNFOnews | Thompson-Okanagan's News Source

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Canadian dollar advances ahead of Bank of Canada interest rate announcement

April 14, 2014 - 5:46 AM

TORONTO - The Canadian dollar was higher Monday amid a dearth of Canadian economic data and mixed commodity prices.

The loonie moved up 0.13 of a cent 91.21 cents US.

Traders are primarily focused on the Bank of Canada and the central bank's next interest rate announcement on Wednesday. Analysts universally expect the bank to leave its key rate at one per cent, where it has been since September 2010.

And generally, the announcement isn't expected to have much effect on the currency.

"We expect USD/CAD to be relatively comfortable either side of $1.10 (90.9 cents US) for the next several months, with a shift lower only to come if Governor Poloz shifts his tone to a less dovish one," said Camilla Sutton, Chief FX Strategist at Scotiabank Global Banking and Markets.

"However the stronger the Canadian dollar is, the more likely Governor Poloz will be to maintain his dovish tone, even as the (Bank of Canada) officially holds a neutral tone."

The other major Canadian economic item for this week is the latest read on inflation.

Economists expect that the consumer price index climbed 0.4 per cent during March. They also expect a positive read from the February manufacturing shipments report, which comes out on Tuesday.

In the U.S., data out Monday showed that retail sales for March came in better than expected. Sales were up 1.1 per cent from February, higher than the 0.9 per cent rise that economists had forecast.

Commodity prices were mixed with May crude on the New York Mercantile Exchange off 11 cents to US$103.63 a barrel.

May copper was up one cent at $3.05 a pound while June bullion gained $2.10 to US$1,321.10 an ounce.

News from © The Canadian Press, 2014
The Canadian Press

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