The markets are awaiting in the American session today, Wednesday, January 25th, the first meeting of the Canadian Central Bank in the current year 2023, as the bank is expected to announce a 25 basis point hike in interest rates, to reach 4.50%, in the eighth consecutive increase in interest rates, to reach their highest levels since 2007. .

The Central Bank of Canada began to tighten monetary policy in March of last year with the rise in inflation, to start raising it by 25 basis points in March, then followed it by raising it by 50 basis points in April and June, by 100 basis points in July and by 75 basis points in September, then it returned again by 50 points.

Basis in October and December, so it will be an increase of 25 basis points is the slowest for the bank since March. Core inflation rates in Canada fell in December to levels of 6.3%, compared to peak levels of 8.1% in June, the highest level of inflation in 40 years, and thus expectations rose that the Bank’s move during this week would be the last of tightening monetary policy, despite the fact that current inflation and its decline It is double the bank’s target of 1-3%.

Canadian labor market figures According to the latest figures for the month of December, the unemployment rate fell to 5%, recording a record level, while the economy added 104,000 jobs in December, which numbers may put pressure on the central bank if it decides to stop tightening monetary policy.

This is in the bank’s endeavor to attract the confidence of investors, the bank to issue minutes of the meeting today, on the eighth of next February, for the first time in history.

The movements of the Canadian dollar will be a reflection of the bank’s decision today, as the current rates calculated the interest rate hike by 25 points mainly, and therefore in the event that there is no surprise from the bank in the level of interest rate hike, the eyes will turn towards the interest statement and the press conference of the bank’s president, which will follow the decision an hour.

Any hints of stopping the process of tightening monetary policy, and that interest rates have reached a peak, will be negative movements of the Canadian dollar, meaning the rise of the dollar pair against the Canadian dollar.