Forex Forex: CAD strength would depend on the Fed – Scotiabank

FXstreet.com (Barcelona) - The Loonie has sharply appreciated against its fellow neighbour on Tuesday, after the BoC has confirmed the markets' broad expectations, leaving the lending benchmark intact at 1.0%. The decision has dragged USDCAD to session lows in the vicinity of 0.9920, although trimming part of those losses at the moment.

Camilla Sutton, Chief Currency Strategist at Scotiabank, comments "OIS markets are pricing in no change in Canadian interest rates over the next 12-months, a view we agree with& the more important medium term impact for CAD is how the Fed decides to manage the conclusion of operation twist and whether they turn to the expansion of QE3 to include Treasuries. We expect today's range to fall between 0.9880 and 0.9962".