BREAKING: CAD strengthens as BoC lifts key rate to 0.50%

The Bank of Canada raised its benchmark interest rate by 25bps to 0.50 %  as widely expected. Central bank is continuing its reinvestment phase, keeping its overall holdings of Government of Canada bonds on its balance sheet roughly constant until such time as it becomes appropriate to allow the size of its balance sheet to decline. Inflation is now expected to be higher in the near term than projected in January. Persistently elevated inflation is increasing the risk that longer-run inflation expectations could drift upwards. The Bank will use its monetary policy tools to return inflation to the 2% target and keep inflation expectations well-anchored. No post-meeting press conference will be held.

USDCAD pair fell and tested support level at 1.2660 after today's BoC rate decision. Source:xStation5