The euro was quoted at C$1.5580 in a delayed market feed early Thursday, below Tuesday’s reported C$1.5650 level, as the European Central Bank prepared to announce its latest policy decision.
MarketScreener’s delayed quote recorded the rate at 2:19 a.m. ET (06:19 UTC) on Oct. 29. FXStreet traced the pair’s slide to Oct. 16. It attributed recent pressure on the euro to the approaching ECB decision and cited Canadian-dollar strength after the Bank of Canada raised rates Wednesday.
On Wednesday, the Bank of Canada lifted its overnight target by 25 basis points, taking it to 2.50%. Its Bank Rate became 2.75%, and its deposit rate reached 2.45%. The bank said inflation had been near 3% since April and projected it would be about 3.5% by year-end.
In September, consumer price inflation excluding gasoline was 2.2%, while the bank’s core measures were around 2%. The central bank linked cost pressure to high oil prices, which raised production and transportation expenses. Businesses had absorbed most higher input costs so far, the bank said, with more of those expenses expected to pass through over the coming year.
Bank of Canada Governor Tiff Macklem said further rate increases remained possible, with uncertainty shaping the bank’s next steps. “We will proceed carefully,” he said in an Oct. 28 opening statement.
The ECB’s most recent published decision, dated Sept. 10 and effective Sept. 16, set its deposit facility rate at 2.50%, its main refinancing rate at 2.65% and its marginal lending rate at 2.90%. The bank also raised rates in June, citing inflation pressures tied to conflict in the Middle East and higher energy prices. Its Governing Council said it was not committing to a particular rate path.
The ECB scheduled its Oct. 29 decision for 9:15 a.m. ET (13:15 UTC), with a news conference at 9:45 a.m. ET (13:45 UTC).
