The loonie spiked following comments from Bank of Canada Senior Deputy Governor Carolyn Wilkins, who said the impressive first quarter growth could push the Central Bank to consider whether highly accommodative interest rates are still required. The Central Bank cut rates twice in 2015 in the wake of the global oil rout, with the key rate remaining unchanged at 0.50%.
Canada’s gross domestic product expanded at an annualised pace of 3.70% during the first three months of 2017, with rising crude oil production and stronger consumer spending driving a broad-based recovery. After not raising the benchmark rate in seven years, the Bank of Canada is scheduled to make its next interest rate decision on July 12th amid the growing prospect of a gradual shift away from loose monetary policy. EURCAD was last seen around the 1.4865-mark, with immediate support sitting at 1.4840.