Forex - Canadian dollar falls after BoC leaves rates on hold
LONDON (Thomson Financial) - The Canadian dollar was lower after the Bank of Canada left interest rates unchanged at 4.25 pct, saying it sees inflation risks as roughly balanced.
In a statement the BoC said while there is a risk that the recent high level of inflation could persist longer than projected and that there is also the chance of a more pronounced slowdown in the US economy - the country’s key trading partner.
“The current level of the target for the overnight rate is judged, at this time, to be consistent with achieving the inflation target over the medium term,” the BoC said.
At 2:14 pm the US dollar was trading at 1.2226 cad, having been at 1.1198 shortly before the BoC announced its decision.
The latest inflation figures, out on Thursday, showed CPI was up 0.8 pct on a monthly basis in March and up 2.3 pct year-on-year. The BoC is chargedwith keeping inflation at the mid-point of its 1-3 pct target.
rachel.armstrong@thomson.com
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