After night data from Australia we observed on charts significant slides of AUD. Price of AUD/USD is now below yesterday’s close and it seems that pair will continue its decline. Market now focuses on afternoon decision on interest rates of Bank of Canada.
Just before the decision of the BoC, which should remain the highlight of today’s session, it is worth looking at other events in the calendar.
We start from yesterday’s speech of Graeme Wheeler in fornt of parliamentary committee. Governor of the Reserve Bank of New Zealand was answering questions from politicians . He admitted that the current economic situation of the country is relatively good and expects return of inflation above the required minimum later this year.
Wheeler is disappointed with the level of economic growth per capita and productivity growth of the national economy. In response to governor of the RBNZ yesterday’s comments, NZD/USD has corrected slightly yesterday’s declines, while today’s session pair moves in consolidation:
The nearest important from the point of view of the foreign exchange market will be the publication of data from UK. At 10:30 we will know latest reports on industrial production and industrial processing.
For the next hours most of the data will be of low importance to investors. Starting from 16:00 the market will reinvigorate and will closely monitor the data flowing to us from America. Slightly less important in this case will be data concerning the US labor market (Jolts Openings) because at the same time BoC will decide on the size of overnight rate.
The market does not expect any change in monetary policy of the Bank and expects that that rate will remain unchanged at 0.5%. A more dovish stance of BoC will certainly be a negative signal for CAD:
Half an hour later, at 16:30 next important data on this day – this time on oil. Americans, like every week, will report change in its inventory of black gold. Due to the strong correlation between CAD and oil prices data may soften or strengthen the movements after BoC decision.