USD/CAD: Greenback Recovers Ground Against the Loonie as Markets Await BoC Poloz’s Speech

The US dollar picked up some support against the Canadian dollar during the London session, following a sharp sell-off in the currency on the back of a dovish Fed meeting yesterday.

As widely expected, the Fed left interest rates unchanged within their current range of 1.50-1.75% and lowered forecasts to project no further up- or down-moves in rates through 2020. This dovish stance was partly unexpected and led to a massive sell-off in the US dollar across the board, falling as much as 0.43% against the Canadian dollar in yesterday’s trade.

To recall, Trump has recently expressed his worries over the dollar’s strength on Twitter, putting the blame on Fed’s Powell. Whether this had an impact on Powell’s dovish tone remains unclear, but a strong dollar has already started to have negative effects on the US manufacturing sector.

Another key note from the Fed’s press conference was Powell’s signal that some policy makers would let inflation rates run above the Fed’s 2% target, which helped reinforce the dollar-bearish bias in the markets.

Today, the US released PPI and core PPI numbers for November which both missed market expectations. The change in prices in finished goods and services sold by producers, excluding food and energy, fell by 0.2% in November vs forecasts of a 0.2% raise.

Later today, markets are awaiting Bank of Canada Governor Poloz’s speech scheduled at 5:30 p.m. London time. Poloz, who has just announced he will step down in 2020, is due to give his remarks about Canada’s economic outlook for 2020 in Toronto.

Given the relatively weak Canadian labour market data from last week, with reports showing the biggest employment drop since 2009 and a rising unemployment rate, markets will be closely following Poloz’s comments for a dovish tone.

A robust and resilient labour market has been the main reason why the BoC avoided to follow other central banks in interest rate cuts so far.

As of 2:30 p.m., one US dollar traded at 1.3188 Canadian dollars. is a news site only and not a currency trading platform. is a site operated by TransferWise Inc. (“We”, “Us”), a Delaware Corporation. We do not guarantee that the website will operate in an uninterrupted or error-free manner or is free of viruses or other harmful components. The content on our site is provided for general information only and is not intended as an exhaustive treatment of its subject. We expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of our site, any you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content on our site. Although we make reasonable efforts to update the information on our site, we make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Some of the content posted on this site has been commissioned by Us, but is the work of independent contractors. These contractors are not employees, workers, agents or partners of TransferWise and they do not hold themselves out as one. The information and content posted by these independent contractors have not been verified or approved by Us. The views expressed by these independent contractors on do not represent our views.