The Bank of Canada's 75 basis point hike was in line with what economists were expecting and that's left USD/CAD chopping in the 1.3200-1.3165 range in the aftermath.
The pair is 30 pips higher today on the plunge in oil prices but that's balanced by better risk appetite in general.
What's left the market flailing a bit is the lack of guidance ahead. The BOC in the statement said rates will need to rise further but didn't offer any indication by how much. Language about front-loading hikes was also removed.
Overall though, the statement hit a hawkish note to these ears. Previously, there was talk of a top at 3.50% but that's looking less likely as global central banks embrace the idea of breaking inflation despite economic consequences.
Tomorrow, we'll get a speech from BOC senior deputy Caroyln Rogers and that could be key for a sustained Canadian dollar reaction.
