On Wednesday, the Canadian bulls grew stronger sending the USD/CAD pair into fresh lows around the 1.3230 handle. The sentiment was fueled by Bank of Canada’s decision to leave the overnight rate target unchanged at 0.5% – in line with expectations: the Bank rate is set at 0.75%, while the deposit rate at 0.25%. BoC (Bank of Canada) declared that it expects a greater global economic growth than international analysts forecast, despite of the risks. At the same time, the bank acknowledges the economic growth pace registered in the US. For what regards the crude oil trend, Canadians recognize the significant impact it has on the domestic growth. The inflation in Canada is within expectations, while household spending stands keeps the domestic demand afloat.
The RBNZ (Reserve Bank of New Zeeland) pushed down the OCR (official cash rate) by 25 basis points, setting the new value at 2.25%. Due to this unexpected decision, the NZD/USD pair dropped from 0.68 to 0.6620. The bank explained that the move is preemptive as the global economic outlook is in a deteriorating state since December’s monetary policy meeting. In the statement, they also added that a further easing might occur and further NZD depreciation is to be expected.
On Thursday, the European currency continued to go up boosted by Draghi’s conference following the ECB’s (European Central Bank) decision to raise the economic stimulus, despite analysts not foreseeing it. The EUR/USD went up more than 300 pips on behalf of this decision, with the day’s trading range between 1.0821 and 1.1183 – at the moment of writing the major was up 1.54% for the day, the EUR being the best performing currency in the market. ECB’s announcement announced rate cuts – 5 basis points for the main refinancing rate (now at 0%), and increases in the asset purchase program – the previous EUR 60 billion budgeted went up to EUR 80 billion.
The US oil closed with a slight loss yesterday after news came out regarding the meeting between OPEC (Organization of Petroleum Exporting Countries) and non-OPEC countries; it seems like the meeting will not be held until Iran will announce its presence. The WTI (West Texas Intermediate) price traded between $37.22 and $38.47 per barrel, to close the session at $37.78, $0.51 down for the day or 1.36% lower. Over the course of this month, the WTI went up more than 30%, exiting the 13-year low area in which it was in the mid-February.
