The Bank of Canada announced that it lowered its policy rate by 50 basis points to 0.25%.
“The rate cut is intended to provide support to the Canadian financial system and the economy during the COVID-19 pandemic,” the BoC said in a statement. “COVID-19 is having serious consequences for Canadians and for the economy, as is the abrupt decline in world oil prices.”
Market reaction
With the initial market reaction, the USD/CAD pair gained more than 50 pips in a matter of minutes and was last seen trading at 1.4142, adding 0.9% on the day.
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