Bank of Canada Comments Send Loonie Higher

Right now, the Canadian dollar is seeing gains against nearly all of its major counterparts as the Bank of Canada comes out sounding a bit hawkish. Loonie is finding support in general risk appetite as well, and receiving some help from higher oil prices.

Everything seems to be going right for the Canadian dollar today. The BOC came out and said that putting a stop to stimulus measures might be a priority, and many are taking that to mean that an interest rate hike is on the way. In a low-yield environment, any currency connected to an interest rate hike is likely to be favored in the currency market.

On top of the seemingly hawkish comments from the Bank of Canada, there are also other forms of support for the loonie in forex trading. Risk appetite in general is on the rise, as demand in the Spanish bond auction allays some economic fears. The International Monetary Fund has improved its forecast for the global economy, including a boost for the US economy, which is a major trading partner for Canada. Higher oil prices are also helping the loonie today, since oil is a major export for Canada.

At 14:24 GMT USD/CAD is down to 0.9875 from the open at 0.9993. GBP/CAD is lower at 1.5739, down from the 1.5890. EUR/CAD is down to 1.2966 fromt he open at 1.3120.