As inflation enters the target range, the Bank of Canada cuts interest rates, and the Canadian dollar weakens.

After the Bank of Canada cut interest rates, it is understandable that the Canadian dollar fell among most G7 currencies, with the most notable being the rise of the US dollar against the Canadian dollar after the data release. Following a surprising increase in the US services purchasing managers' index (PMI), the US dollar was boosted and further rose.

FX678 FinanceJun 5 11:09 ET

The Bank of Canada has fired the first shot of interest rate cuts! It may continue to cut in July! Short-term gains for USD/CAD have increased by over 50 points.

On June 5th, 2024, the Bank of Canada announced its first interest rate cut since 2020, lowering the benchmark interest rate by 25 basis points to 4.75%, a decision in line with market expectations. This move signifies that Canada has become the first central bank in the G7 to initiate an easing cycle of monetary policy, providing a new direction for global monetary policy.

FX678 FinanceJun 5 10:02 ET

High mortgage interest rates remain in the United States. Applications for housing mortgage loans have experienced the largest drop since early April.

According to the Zhitong Finance APP, due to mortgage interest rates staying above 7%, the number of US housing mortgage applications last week experienced the largest decline since early April. Data released by the Mortgage Bankers Association (MBA) on Wednesday showed that the mortgage application index for home purchases decreased by 4.4% for the week ending May 31 (including Memorial Day). The contract rate for 30-year fixed-rate mortgages increased by 2 basis points to 7.07%, the ninth consecutive week above 7%. However, the interest rate for adjustable-rate mortgages with a term of five years decreased by 27 basis points to a two-month low of 6.37%. Mortgage loans.

Zhitong FinanceJun 5 08:50 ET

USD/CAD Advances Toward 1.3700 Ahead of US Data, BoC Policy Meeting

USD/CAD edges higher ahead of BoC’s interest rate decision and US Employment, and ISM Services PMI data.

FXStreetJun 5 06:40 ET

USD/CAD Price Analysis: Maintains Position Above 1.3650 Due to Weakening Bearish Bias

USD/CAD could extend its gains as the 14-day RSI indicates a momentum shift toward the upside

FXStreetJun 5 04:08 ET

Dollar Crisis Warning: The US economy is weak, and non-farm data will trigger the market!

The US economy has not shown any major danger signals, but some small worries are accumulating. The manufacturing PMI was in contraction range on Monday. As weak economic data gives the Federal Reserve a strong inclination towards loose policies, the dollar is declining. This Friday, the dollar will face the challenge of May's non-farm employment data.

FX678 FinanceJun 5 03:26 ET