The dollar rises; the Canadian dollar falls before the meeting of the Bank of Canada
The dollar rises; the Canadian dollar falls before the meeting of the Bank of Canada
The US dollar rises on Wednesday as traders take a calmer appearance of a virus similar to pneumonia in China, although their earnings have been minimal and caution still reigns.
At 10:10 hours (CET), the dollar index futures , which follow the evolution of this currency with respect to a basket of six other major currencies, rise 0.1% to 97.42. The yen is left 0.1% against the dollar, placing USD / JPY at the level of 109.97. The EUR / USD pair falls 0.1% to 1.1079 and the GBP / USD stands at 1.3043, leaving 0.1%.
Chinese authorities have confirmed on Wednesday that at least nine people, all in Wuhan, have died after contracting the virus and 15 medical staff members have been infected.
“The obvious comparison that people are making is with SARS. Although we still don’t know how lethal the new virus will be, my feeling at the moment is that markets are not taking it as seriously as SARS,” Kyosuke said. Suzuki, currency director of Societe Generale (PA: SOGN), in a Reuters report.
“At that time, virtually all companies banned traveling to Hong Kong. We haven’t seen that kind of reaction yet,” he said.
The 2002 SARS pandemic ended with more than 8,000 people from 37 affected countries, and about 800 deaths.
Looking ahead, the Bank of Canada holds its interest rate setting meeting on Wednesday, and the markets do not expect any changes in monetary policy.
However, the Canadian dollar has a downside risk after this meeting, explains Francesco Pesole, an analyst at ING (AS: INGA ), in a research note.
“Investor confidence about the prospect of relaxation by the Bank of Canada has changed significantly in recent months,” he says. But “we suspect that a downward revision of GDP forecasts (…) is not disposable. Any significant change in the monetary policy stance is unlikely for now, so those projections have the potential to determine most of the market reaction. ”
At 10:05 a.m. (CET), the USD / CAD pair stands at the level of 1.3077, up 0.1%.
