Interest rates may be going higher in the U.S. this month, but in Canada no movement is expected in the foreseeable future.
It’s not a surprise that the Canadian dollar has felt the pressure of a pending U.S. rate hike and the odds have doubled now that the rate rise is coming March 15.
This has put increased downward pressure on the loonie, particularly in light of Wednesday morning’s Bank of Canada non-event.
A U.S. rate hike for March just a week ago was given less than a 20 per cent chance, it has now moved to greater than 80 per cent.
The Canadian dollar, which has lost over 1 1/4 cents in the past five days, will continue under pressure, at least until the Bank of Canada indicates that a Canadian interest rate hike is in the offing, and that won’t be anytime soon.