Investing.com – The Canadian dollar fell against its U.S. counterpart on Wednesday after the Bank of Canada kept monetary policy on hold and said it will be cautious as it considers future interest rate moves.
USD/CAD was up 0.69% to 1.2760 by 10.25 AM ET (02:25 PM GMT), from around 1.2680 earlier.
The BoC held interest rates steady at 1.00% as widely expected after back-to-back rate hikes in July and September.
In its monetary policy statement the central bank said that while less stimulus will be needed over time it will be cautious as it considers making further interest rate adjustments given uncertainties facing the economy.
“While less monetary policy stimulus will likely be required over time, Governing Council will be cautious in making future adjustments to the policy rate,” the statement said.
The bank said the economy is operating close to its potential but noted that there is still slack remaining in the labor market.
The bank said inflation will rise to 2% slightly later in 2018 than previously expected and export growth will be slightly slower because of the recent appreciation of the Canadian dollar.