The Canadian dollar continues to suffer and even reach lows against the dollar following the surprising rate cut with USD/CAD already flirting with 1.24. Is it just a surprising one-off? Probably not, says the team at Nomura: Here is their view, courtesy of eFXnews: The Bank of Canada surprised by cutting its policy rate by 25bp to 0.75%, the first move in 4 years. The BoC justified the cut by saying that “the oil price shock increases both downside risks to the inflation profile and financial stability risks.” The Bank’s policy action is intended to provide insurance against these risks. The BoC also revised sharply its growth forecast. We believe that the BoC would not have ended its longer period of rates stability unless it believed that there were threats that inflation could fall below the target for a long period of time. However, we think that there are some downside risks to these forecast because: 1) The assumption of oil prices around $60 seems a bit optimistic given we are stabilizing around $50, 2) it shows a quick recovery later this year, supposing little persistence in the oil shock and 3) despite the widening of the output gap, core inflation was revised slightly higher. Nevertheless, as we highlighted above, the forecast seems to have been based on some optimistic assumptions. As such, we see downside risks to the BoC forecast. With this in mind, we believe the BoC is likely to cut again in the near future, could be as early as the March meeting, unless oil prices rebound. &For lots more FX trades from major banks, sign up to eFXplus By signing up to eFXplus via the link above, you are directly supporting Forex Crunch. Yohay Elam Yohay Elam Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts. Yohay's Google Profile View All Post By Yohay Elam Forex News Today: Daily Trading News share Read Next Dollar on a roll: EUR/USD dives deeper below 1.1320, Yohay Elam 8 years The Canadian dollar continues to suffer and even reach lows against the dollar following the surprising rate cut with USD/CAD already flirting with 1.24. Is it just a surprising one-off? Probably not, says the team at Nomura: Here is their view, courtesy of eFXnews: The Bank of Canada surprised by cutting its policy rate by 25bp to 0.75%, the first move in 4 years. The BoC justified the cut by saying that "the oil price shock increases both downside risks to the inflation profile and financial stability risks." The Bank's policy action is intended to provide insurance against these risks.… Regulated Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk. 4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk. 5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.