Regular BOC interest rate decisions disseminate information on the health of the Canadian economy and policy expectations. AUD/USD is one of the most liquid and widely traded currency pairs. In this article, we look at basics of trading it from both the fundamental and technical analysis perspectives.
What is the BOC monetary policy framework?
The BOC monetary policy framework consists of two main components, the inflation-control target and the flexible exchange rate. Regular BOC interest rate decisions disseminate information on the health of the Canadian economy and policy expectations. AUD/USD is one of the most liquid and widely traded currency pairs.
How have interest rates changed over the last year?
Over the last year, interest rates have dropped from 2.1% to 0.9%, a 65% decrease. Rates are now below 1945 levels—and well under 6.1%, the average U.S. interest rate over the last 58 years. Interest rates in the 18th and 19th centuries also provide illuminating trends.
Who sets interest rates?
In the United States, the authority to set interest rates is divided between the Board of Governors of the Federal Reserve (Board) and the Federal Open Market Committee (FOMC). The Board decides on changes in discount rates after recommendations submitted by one or more of the regional Federal Reserve Banks.
