- The Bank of Canada indicated yesterday it would be likely to raise rates in 2022, sharply increase its growth forecasts for the Canadian economy, and cut the pace of bond purchases from $4 to $3 billion. This more hawkish policy shift caused the values of the Canadian dollar and the Canadian stock market to increase.
- The strong long-term rally in U.S. and Eurozone stock indices saw a weak recovery yesterday. Asian markets are also mostly higher today.
- Bitcoin continues to look weak, trading at the lower boundary of its recent consolidation range.
- The Forex market is quiet and mixed. The Japanese yen and the Canadian dollar are the strongest major currencies.
- The European Central Bank will give its monthly policy release today, which is likely to cause volatility in the euro.
- British and Canadian inflation data releases came in slightly below expectations yesterday.
- Yesterday saw an all-time record high number of confirmed daily new coronavirus cases globally. The situation is especially bad in India, which is seeing explosive growth in infection and an exponential rise in case numbers to new highs, which is putting a severe strain on the Indian health care system due to a shortage of oxygen. There are fears of mutations arising in India which would be resistant to current vaccines. Japan is about to declare a state of emergency in Tokyo as the Olympics approach and cases surge amidst a slow pace of vaccination.
- Global coronavirus deaths increased last week for the fifth week running after falling for months, signifying a rebound in the pandemic in areas where vaccinations are relatively absent.
- Total confirmed new coronavirus cases worldwide stand at over 144.4 million with an average case fatality rate of 2.13%.
- The fastest progression in terms of immunizing a population against the coronavirus in all but the smallest states has been in Israel, which has given at least one shot to 62% of its entire population followed by the U.A.E. at 51%. For most of the world, a vaccine remains distant. However, the pace of vaccination has finally begun to speed up in the European Union, which now has nine member states (Hungary, Finland, Estonia, Lithuania, Germany, Belgium, Austria, the Netherlands, and Spain) having immunized more than 20%.
- The rate of new coronavirus infections appears to now be increasing most quickly in Argentina, the Bahamas, Cambodia, Canada, Colombia, Croatia, Cuba, Cyprus, Egypt, Georgia, Guatemala, Honduras, India, Iran, Iraq, Japan, South Korea, Lithuania, Malaysia, Mongolia, Pakistan, Saudi Arabia, Trinidad, Tunisia, Turkey, Venezuela, and Uzbekistan.
Forex Today: Loonie Gains as BoC Cuts Stimulus
Adam Lemon
Canada becomes the first major economy to see a central bank confident enough to taper emergency measures.