USD/CAD holds steady amid rising oil prices

Key Movers

The US Dollar Index (DXY) traded near the 103.55 range this morning, maintaining steady ground ahead of the Bank of Japan (BoJ) and Reserve Bank of Australia (RBA) monetary policy decisions overnight and the Federal Reserve interest rate announcement set for Wednesday. Despite some dovish remarks from Fed Chair Jerome Powell recently, most Fed officials showed caution around premature monetary easing. Rising US Treasury yields lent some strength to the DXY this morning. US Treasury bond yields rose alongside trading figures at 4.75% for the 2-year yield, 4.35% for 5-year yields, and 4.33% for the 10-year yields. Markets will be sure to keep a close eye on Wednesday’s rate decision.

The EUR/USD pair traded in a bearish tone this morning near the 1.08711 range. Euro moves are likely to remain limited ahead of Wednesday’s Fed monetary policy decision.

The GBP/USD traded in the low 1.27 range this morning. UK inflation is expected out tomorrow, followed closely by the Bank of England (BoE) rate decision on Thursday. The BoE is expected to hold rates at 5.25% while inflation in the UK is expected to drop, which will be crucial for the BoE’s forecast of 2% inflation by mid-year.

The USD/JPY pair held close to gains over 149.00 this morning ahead of the BoJ’s rate decision tomorrow. According to Bloomberg, the BoJ is expected to hike rates during its meeting tomorrow.