The Stephen Poloz era begins tomorrow with his first Bank of Canada decision as leader.
The market is testing minor support in the 1.3080 zone after several failed attempts to break 1.0445/50 earlier today. The market is positioned in USD/CAD longs and it looks like traders are scaling out of positions on the uncertainty of what Poloz might say along with the testimony from Bernanke.
My take is that Poloz might be dovish given the unwanted rise in Canadian yields following Fed taper talk. Yesterday, the Global & Mail hinted he could surprise by signaling a longer period of low rates.
