Canada Dollar Climbs for Fourth Day on Central Bank View

Canada’s dollar strengthened to a 13-month high versus its U.S. counterpart, on optimism measures by policy makers in the U.S. and Europe will reduce volatility.

The currency gained for a fourth day as the Federal Reserve prepares to begin a two-day policy meeting where investors anticipate it will announce a third round of bond buying, known as quantitative easing, to spur the economy. A German court cleared the way for a ruling tomorrow on a European bailout plan. The anticipated price swings versus the U.S. dollar were almost the lowest in five years, according to options pricing.

“The movement we’ve seen in the Canadian dollar, we’re a little suspicious of it because it seems to be part and parcel with the theory that more global stimulus is coming and therefore the market rallies,” said David Madani, an economist at Capital Economics Canada in Toronto. “Global monetary policy makers are trying to pull out all the stops right now.”

via Bloomberg

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.