Forex
CAD Weighed Down by Fed Hike Expectations and BoC Divergence
The Canadian Dollar is stuck near its monthly lows against the US Dollar due to growing expectations of Federal Reserve tightening.
Markets are focused on the two-day FOMC meeting, which starts today and is expected to deliver an interest rate hike for the first time in three years. Futures markets price a 92% chance of a 25 basis point hike tomorrow.
The strong employment report in August and hot inflation figures released yesterday have boosted expectations of some Fed tightening this week and another before the year-end, likely in December.