There has been a big change in the stance of the Bank of Canada lately, with the statement from the Bank accompanying Wednesday’s rate hike surprising all the pundits.
The hike had been widely discounted, but the hawkish stance by the Bank on the health of the Canadian economy, and especially the potential for growth the rest of this year caught traders by surprise.
This sent the Canadian dollar up well over one cent, as analysts now expect a second hike as soon as September, but certainly by October at the latest.
The American economy has cooled and there’s also word from the U. S. Federal Reserve that there might not be another rate hike this year, putting a damper on the U.S. dollar.
All that is a formula for our dollar to take a potential run at 80 cents before the year is out.
Looking good for U.S. bound travellers!
Join Michael Levy Saturday morning at 8:45 AM on Moneytalks with Mike Campbell as they further discuss the impact of rising interest rates.