Keep an eye on the Canadian dollar’s movements to see if the policy rate will be cut by 0.25%
29.01.2025
- U.S. FOMC Policy Rate and Statement Release
- Canada: BOC Policy Rate and Statement Release
In yesterday's U.S. currency trading, the Canadian dollar rose against the yen ahead of today's Bank of Canada policy rate announcement.The CAD/JPY pair traded between 107.396 and 108.269. It has retreated from the -3σ line of the hourly Bollinger Bands back toward the centerline. Meanwhile, on the 4-hour chart, the 20-period moving average is capping the upside, and on the daily chart, the RSI is trending downward from around the 60 level. We will need to monitor price action during U.S. trading hours to see if the Canadian dollar continues to weaken.
Among European currencies, the pound fell against the U.S. dollar. The GBP/USD pair dropped from 1.2495 to 1.2415. On the hourly chart, the price has moved from above the 20-period moving average (MA) to below it. On the 4-hour chart, the price is currently retesting the resistance zone formed by the 200-period simple moving average (SMA), which it had briefly broken above earlier. During today’s Asian trading session, the pound has turned higher again. We will need to assess whether the pound can maintain this upward momentum.
Today’s economic indicators include the Australian Consumer Price Index at 9:30, the Japanese Consumer Sentiment Index at 14:00, the Swedish central bank’s policy rate and statement at 16:00, the Eurozone money supply at 18:00, the U.S. MBA Mortgage Applications Index and Mexican employment statistics at 21:00, U.S. wholesale inventories at 22:30,23:15 UK: Remarks by BOE Governor Bailey; 23:45 Canada: BOC Policy Rate and Statement; 24:30 Canada: BOC Governor Maclean Press Conference; US: Weekly Crude Oil Inventories; 28:00 US: FOMC Policy Rate and Statement; 28:30 US: Remarks by Fed Chair Powell.We will be watching the Canadian dollar’s movements following the release of these indicators to see if the policy rate is cut by 0.25% as expected by the market.
Author: Keisuke Sakurai
