USD/CAD: What to Expect from BoC Next Week?

USD/CAD: What to Expect from BoC Next Week?

Canada’s central bank is set to announce its next rate decision on Oct. 23, with Canadian banks largely anticipating a 50-basis-point cut. A similar reduction is also expected at the BoC's final meeting of the year on Dec. 11.

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The prospect of back-to-back cuts is weighing heavily on the Canadian dollar, which touched to a two-month low of 1.383 against the U.S. dollar on Tuesday. Technical indicators, including moving averages, suggest a potential short-term bullish trend for the pair.

Meanwhile, in the U.S., Minneapolis Fed President Neel Kashkari indicated this week that any future rate cuts from the Federal Reserve could be "modest." Which the market might be interpreting as a bias for a smaller 25-basis point cut.