Investing.com - The U.S. dollar trimmed gains against the Canadian dollar on Wednesday after the Bank of Canada kept its benchmark interest rate steady at its monthly meeting and indicated that rates are likely to remain on hold in the near term.
USD/CAD pulled back from session highs of 1.0432, to hit 1.0398 during U.S. morning trade, still up 0.30% for the day.
The pair was likely to find support at 1.0354, the session low and resistance at 1.0470, the high of July 11.
In its first meeting under the helm of new Governor Stephen Poloz, the BoC said it was leaving its overnight cash rate unchanged at 1%, in line with expectations.
In its rate statement, the bank said that as long as there is significant slack in the Canadian economy, the inflation outlook remains muted, and imbalances in the household sector continue to evolve constructively the monetary policy stimulus currently in place will remain appropriate.
Earlier Wednesday, Federal Chairman Ben Bernanke said the central bank expects to start tapering bond purchases by the end of the year, but added that there was no “preset course.”
Bernanke said the bank’s bond purchase program could be tapered at a faster pace, slower pace or even temporarily increased depending on economic and financial developments.
Bernanke said the economic recovery was continuing at a moderate pace but reiterated that accommodative monetary policy will still be necessary for the foreseeable future.
The comments came during prepared testimony to the Financial Services Committee in Congress.
Meanwhile, official data showed that the number of building permits issued in the U.S. fell unexpectedly in June, while housing starts tumbled.
The number of building permits issued in June fell 7.5% to a seasonally adjusted 0.911 million, confounding expectations for an increase of 1.5% to 1.000 million units.
U.S. housing starts plunged by 9.9% last month to hit a seasonally adjusted 0.836 million, compared to expectations for an increase of 3.9% to 0.959 million.
Elsewhere, the loonie, as the Canadian dollar is also known, was fractionally lower against the euro, with EUR/CAD edging up 0.08% to 1.3662.
USD/CAD pulled back from session highs of 1.0432, to hit 1.0398 during U.S. morning trade, still up 0.30% for the day.
The pair was likely to find support at 1.0354, the session low and resistance at 1.0470, the high of July 11.
In its first meeting under the helm of new Governor Stephen Poloz, the BoC said it was leaving its overnight cash rate unchanged at 1%, in line with expectations.
In its rate statement, the bank said that as long as there is significant slack in the Canadian economy, the inflation outlook remains muted, and imbalances in the household sector continue to evolve constructively the monetary policy stimulus currently in place will remain appropriate.
Earlier Wednesday, Federal Chairman Ben Bernanke said the central bank expects to start tapering bond purchases by the end of the year, but added that there was no “preset course.”
Bernanke said the bank’s bond purchase program could be tapered at a faster pace, slower pace or even temporarily increased depending on economic and financial developments.
Bernanke said the economic recovery was continuing at a moderate pace but reiterated that accommodative monetary policy will still be necessary for the foreseeable future.
The comments came during prepared testimony to the Financial Services Committee in Congress.
Meanwhile, official data showed that the number of building permits issued in the U.S. fell unexpectedly in June, while housing starts tumbled.
The number of building permits issued in June fell 7.5% to a seasonally adjusted 0.911 million, confounding expectations for an increase of 1.5% to 1.000 million units.
U.S. housing starts plunged by 9.9% last month to hit a seasonally adjusted 0.836 million, compared to expectations for an increase of 3.9% to 0.959 million.
Elsewhere, the loonie, as the Canadian dollar is also known, was fractionally lower against the euro, with EUR/CAD edging up 0.08% to 1.3662.