BoC Hike Bets Spark Canadian Dollar Rally Amid Inflation Concerns

The Canadian dollar has strengthened to a new high of 1.385 per USD after the Bank of Canada expressed concerns about inflation risks in its September meeting.

In its decision, the Bank of Canada left its key policy rate unchanged at 2.25%, but signaled that it may adjust policy as needed due to increased uncertainty and elevated energy costs.

The central bank's statement highlighted the impact of new tariffs on the growth outlook, while also noting that oil prices remain high amid supply disruptions in the Middle East.