Today it is about the ECB, but let us not forget the BoC lowered rates first. Different to the ECB, the Canadian central bank had analysts divided on whether it will deliver a June rate cut
Now, the Fed-BoC rate spread has widened, and we're yet to see by how long and how much. Recent central bank action has seen Fed rate cut bets moved forward
Key data ahead: Canada labour report, Non Farm Payrolls, US CPI, and the FOMC
The developments will decide the cross direction as technicals show a sharp move could be coming over the next weeks (shrinking BBs). Looking at 2y swap spreads, the breach above 0.600 could push USD/CAD to move closer to 1.40 in coming days
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