This morning the Federal Reserve will likely announce no rate hike, when it will start to taper its bond purchases, and start to give a different outlook of where the U.S. economy is going. While most economists believe that inflation, even at these high levels, is still a temporary event, a little longer than anticipated, but still temporary. Markets anticipate a U.S. rate hike in June of 2022, that’s basically eight months away, a lot can happen between now and then. If the supply chain disruptions are not remedied soon, then inflation will rise even higher, leaving central banks no option but to curtail. Perhaps a rate hike in April may be in the cards, we will have to wait and see.
The Canadian dollar is generally unchanged, energy prices have dropped, while metals are down as well, copper is still trading off its highs and looks to trade even lower. Expect a narrow range till the Fed comes out and then will shall see what happens.
Currently* Close Range
USDCAD 1.2415 1.2409 1.2405-1.2457
EURCAD 1.4380 1.4366 1.4365-1.4408
GBPCAD 1.6965 1.6895 1.6890-1.6988
*Indicative Rates Only
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