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USD ends mixed as Bank of Canada holds rates and FX awaits US jobs report
The Canadian central bank kept its policy rate at 2.25%, shifting expectations toward a higher chance of a later rate hike.
The US dollar ended the session mixed, trading lower versus the yen, Canadian dollar and Australian dollar, while it rose against the euro, British pound, Swiss franc and New Zealand dollar, according to Forexlive’s investingLive Americas FX news wrap. Forexlive reported that USDJPY fell around 0.8%, with support attributed to hawkish comments from BOJ policymaker Takata and remarks from Treasury Secretary Bessent. In Canada, USDCAD dropped about 0.4% after the Bank of Canada held rates unchanged at 2.25%, while warning that inflation risks had increased, which pushed market expectations toward a greater chance of a rate hike later this year. In other moves, the Australian dollar gained roughly 0.3% against the greenback, while the New Zealand dollar fell about 0.7% versus the USD even after the Reserve Bank of New Zealand raised rates by 25 basis points to 2.75%. Forexlive said the hike was expected, but the projected path for future rates was lower than markets had priced in. The wrap also noted ongoing focus on Friday’s US jobs report, with investors watching geopolitical headlines while the dollar’s direction remained tied to shifting rate expectations.