Will the BOC’s policy rate cut weaken the Canadian dollar? Market participants are watching closely.

Will the BOC’s policy rate cut weaken the Canadian dollar? Market participants are watching closely.

04.09.2024

In yesterday’s U.S. currency trading, the Canadian dollar fell against the yen ahead of today’s BOC policy rate announcement. The CAD/JPY pair dropped from 109.014 to 107.120, breaking below the support line of the 200-period SMA on the hourly chart. On the daily chart, the pair has pulled back from last month’s highs, while on the weekly chart, the 75-period MA is acting as a strong resistance level.We need to watch closely to see if the Canadian dollar will weaken further following today’s BOC decision to cut rates by 0.25%.

European currencies rose as the Swiss franc strengthened against the U.S. dollar following yesterday’s release of Swiss second-quarter GDP data, which showed a year-over-year improvement from the previous reading of 0.6% to 1.8%. The USD/CHF pair fell from 0.8537 to 0.8478, breaking well below the support line of the 20-period moving average on the hourly chart. On the daily chart, the downtrend that began after the pair touched the 10-period moving average continues, so traders should pay close attention to price movements during U.S. trading hours.

Today’s schedule includes: Australia’s real GDP at 10:30, China’s Caixin PMI at 10:45, India’s services PMI at 14:00, France’s non-manufacturing PMI at 16:50, Germany’s non-manufacturing PMI at 16:55, France’s services and manufacturing PMI at 17:00, the UK’s services and manufacturing PMI at 17:30, and the Eurozone’sProducer Price Index, 7:00 PM South Africa BER Business Confidence Index, 8:00 PM US MBA Mortgage Applications, 9:00 PM Brazil Industrial Production, 9:30 PM Canada International Merchandise Trade, 9:30 PM US Trade Balance,22:45: Canada – BOC Policy Rate and Statement Release; 23:00: US – JOLTS Job Openings, US – Manufacturing Orders; 23:30: Canada – BPC Governor Macleam Press Conference; 27:00: US – Beige Book. We will need to closely monitor price movements following the release of these indicators to see if the BOC’s policy rate cut will weaken the Canadian dollar.

Past Market Reports

1. 17.04.2026New

   Will the market wait and see how much further the U.S. dollar can rise against the yen?

2. 16.04.2026New

   Will the weakening Swiss franc recover? Attention is turning to price movements during European trading hours.

3. 15.04.2026New

   Market participants are likely keeping a close eye on the upside potential of the euro, which has risen against the U.S. dollar

4. 14.04.2026New

   Should we keep an eye on remarks by key figures in the U.S. and try to gauge the direction of currency strength?

5. 13.04.2026New

   Market participants are likely watching for signs of a rebound in the Canadian dollar, which fell against the U.S. dollar following the release of employment figures

6. 10.04.2026

   Will the weakening Swiss franc continue to strengthen against the yen, or should we wait and see?

7. 09.04.2026

   Will the U.S. dollar, which has fallen against the yen, continue its downward slide, or should we wait and see how the market moves?

8. 08.04.2026

   Should we keep an eye on the upside for European currencies that have risen against the U.S. dollar?

9. 07.04.2026

   Market participants may be wary of further downside potential for the U.S. dollar, which has weakened amid concerns over the situation in Iran

10. 06.04.2026

    Investors should be wary of sudden spikes in volatility while major markets are closed