Forex – USD/CAD drops to 1-month lows after BoC holds

The U.S. dollar dropped to a one-month low against its Canadian counterpart on Wednesday, as the Bank of Canada left interest rates unchanged and after the release of downbeat U.S. housing sector data.

USD/CAD hit 1.3445 during U.S. morning trade, the pair’s lowest since April 24; the pair subsequently consolidated at 1.3451, down 0.46%.

The pair was likely to find support at 1.3408, the low of April 24 and resistance at 1.3612, the high of May 19.

In a widely expected move, the BoC kept the benchmark interest rate unchanged at 0.50%.

At the same time, the U.S. National Association of Realtors said existing home salesdecreased 2.3% to 5.57 million units last month from 5.70 million in March. Analysts had expected existing home sales to fall 1.1% to 5.65 million units in April.

Investors were eyeing the minutes of the Fed’s most recent policy meeting, due later in the day, with hopes of further indications on the pace of future rate hikes.

The U.S. dollar broadly weakened recently following a string of revelations surrounding the FBI’s investigation into alleged Russian interference in November’s U.S. presidential election and reports that Donald Trump attempted to interfere with the judicial process.

The loonie was also higher against the euro, with EUR/CAD declining 0.40% to 1.5051.

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