Forex traders are eagerly awaiting today’s FOMC announcement. Expectations call for a 25 basis point interest rate cut by the US Fed to 1.75%, but what will Fed Chief Powell hint in regards to future monetary policy? US President Trump has openly criticized his central bank and even called for negative rates. Inflation has been absent and Trump is seeking assistance in his trade war with China. Despite the more dovish central bank, the US Dollar was able to attract safe haven bids. How will the USDCAD perform after today’s interest rate announcement? Today’s fundamental analysis will explore the downside risk as well as upside potential in this currency pair.

The oil attacks in Saudi Arabia have resulted in a sharp rally in oil prices and has started to benefit the Canadian Dollar which is influence by the price of oil. Today’s CPI data out of Canada is expected to show annualized inflation at the top range of the Bank of Canada’s inflation target. What will this mean for monetary policy out of the Canadian central bank? There remains little room to cut interest rates, will the FOMC cut boost the USDCAD? Subscribe to the PaxForex Daily Fundamental Analysis and join our fast growing community of profitable forex traders!