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The Pound dropped over 120 points after the Bank of England's announcement about stopping of interest rate-raising policy


07.09.2023
The Pound dropped over 120 points after the Bank of England's announcement about stopping of interest rate-raising policy

Today's expected range for the Canadian Dollar against the major currencies:

US Dollar         1.3600-1.3700

Euro                 1.4600-1.4700

Sterling            1.7000-1.7100

 

WTI Oil (opening level) $87.09

The US Dollar index is marginally stronger this morning and remains supported near a 6-month high. The US economy continue to show signs of strength as yesterday a reading from the services sector showed the economy is quite strong which should help to give the Federal Reserve room to increase interest rates in November.

The big mover yesterday was Sterling which dropped over 120 points on comments from Bank of England officials that interest rates are quite restrictive at the moment and won't need to go higher. On these comments the Pound was punished with GBP.USD dropping to trade at 1.2460 and even GBP.CAD fell 150 points to trade at 1.7020 so overall a tough day for Sterling.

The Canadian Dollar is for the most part unchanged this morning, it jumped around in a 40-point range yesterday after the Bank of Canada announced as expected that it was not increasing the interest rate. The Bank went on to say that while the economy is slowing it would not rule out further interest rate hikes if inflation remains elevated. None of this was enough to support the Canadian Dollar so I still look for the US Dollar to remain strong and the Loonie will trade with a weak bias.

Nothing major on the economic calendar for today, stocks remain under pressure so look for the US Dollar to remain supported in what should be a quiet market.

 



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Euro                     1.3425-1.3525

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Euro                     1.3950-1.4050

Sterling                1.6600-1.6700