The Canadian dollar ascended versus the US dollar Thursday, as Bank of Canada Governor Stephen Poloz gave a less than expected dovish stance and oil prices leaped on news Saudi Arabia and its fellow countries mounted air strikes in Yemen.
Poloz, as the oil surge dwindled a bit, said the central bank’s quarter-point rate reduction in January rendered time to evaluate the impacts of cheaper oil in the country.
He did not eliminate a negative reading on the country’s economic growth, but he expected growth to rebound later this year.
Rally in oil prices and Poloz said BOC won’t likely lower rates even if the economy weakens… “that puts the Canadian dollar up about half a cent on the day,” said Adam Button, Currency Analyst at ForexLive.
The loonie closed at C$1.2471 per greenback or 80.19 US cents, from Wednesday’s C$1.2517 or 79.89 US cents.
When Saudi launched strikes in Yemen, the currency accelerated to C$1.2410 overnight, but erased some gains later in the session.
The material has been provided by InstaForex Company – www.instaforex.com