On Tuesday 04-21-09 at 9:00 AM ET, the CAD Bank of Canada Rate Decision report will be released, this report is schedules 8 times per year .
The previous CAD Bank Canada Rate Decision report came out on Tuesday 03-03-09 at 9:00 AM ET.
The CAD Bank Canada Rate Decision report released in March was set up as follows:
Previous Report: 1.00%
Economists Forecast: 0.50%
The actual report: 0.50% – as forecast and not good for the Canadian Dollar.
This rate decision weakens the Canadian Dollar against foreign currencies.
I monitored 4 currency pairs during the March CAD Bank Canada Rate Decision report and here is what happened:
CAD/JPY - moved down about 70 PIPS in 22 minutes – right direction
EUR/CAD – moved up about 130 PIPS in 11 minutes – right direction
USD/CAD – moved up about 123 PIPS in 22 minutes – right direction
The CAD Bank Canada Rate Decision for this month’s release has a “forecast” of 0.50%, which will not change the previous rate interest.
If the “actual” CAD Bank Canada Rate Decision report comes out less or more than the “forecast” by any amount other than what was “forecast”, this would be a huge surprise for FOREX traders and the market may move considerably in the following minutes of the report.
So, let’s set this up:
The March previous= 0.50%
The economists forecast= 0.50%
If the “actual” report comes out with an increase in interest rates, this will be good for the CAD, and a big surprise for traders. Any currency pair which includes the CAD may move in favor of the CAD.
However, if the “actual” report comes out with a decease in interest rates, this would be bad for the CAD and again, a big surprise for traders. Any currency pair which includes the CAD may move against of the CAD.
If the report comes out as forecast, the market may see this as good, in a small way, for the Canadian Dollar, and may move in favor of the CAD.
The probabilities set forth above are assuming no unpredictable events are taking place at the same time.
Speeches on the economy by government officials, or a situation somewhere in the world that could have an impact on the Canadian or US economy – could adversely affect the market.
Sometime after the end of the CAD Bank Canada Rate Decision report I will post the results. So, check back!
Tuesday 04-28-09:
Here are the results of CAD Bank Canada Rate Decision report:
Previous Report: 0.50%
Economists Forecast: 0.50%
The actual report: 0.25% – not as forecast and not good for the Canadian Dollar.
The “actual” report came out at 0.25%, not good for the CAD and the Canadian economy, and not as expected, but good enough for a trade that yielded some good “scalping” opportunities.
Here is how it affected the 4 currency pairs I follow this period:
CAD/JPY - moved down about 72 PIPS in 26 minutes – right direction
EUR/CAD – moved up about 120 PIPS in 27 minutes – right direction
GBP/CAD – moved up about 120 PIPS in 42 minutes – right direction
USD/CAD – moved up about 80 PIPS in 27 minutes – right direction
As you can see, there were a lot of “scalping” opportunities with all 4 currency pairs.
