CAD could break higher if tomorrow's domestic jobs data is strong

Source: FX Solutions' FX AccuCharts

The CAD hit its strongest level in over three weeks after yesterday's interest rate increase by the Bank of Canada. It was its third consecutive interest rate increase of 25 bps over a 4 month period putting the bank rate at 1%. Bank of Canada Governor Mark Carney said in an accompanying statement that while policy-rate increases mean Canadian financial conditions “have tightened modestly,” they are still ‘’exceptionally accommodative.” This hawkish statement left the door open to further interest-rate hikes in 2010. So if the CAD breaks the 1.03 level on strong domestic jobs report tomorrow then a move to 1.0250 is possible.