After a largely range bound session, the BoC finally provided some notable volatility, albeit in the CAD specifically, prompting a 1+ cent gain vs the USD.
No rate cut was expected here, but dovish expectations have been heightened by the Brexit vote. The central bank, however, struck a more encouraging tone. Despite growth rate downgrades, they see signs of a rebound in place, while the contraction in oil sector investment will end this year.
Following swiftly on from this was the DoE report, which saw crude inventories falling but output production rising, leading to the initial jump in WTI quickly reversed, and so tempering the CAD rally. 1.2950 taken out, but the mid 1.2800s are key from here.
Looking to Thursday, the BoE meeting has the market balanced in their expectations between a 25bp cut and on-hold (for now). We would have expected to have seen a little more downside than we have, though the lead EUR/GBP rate has found support ahead of .8300, while cable buyers seen coming ahead of 1.3200.
USD/JPY has been ranging inside 104.00-105.00, but stocks pretty neutral on the day. EUR/USD is through 1.1100 again (partly EUR/GBP led) and now testing the highs through 1.1100 seen in the wake of the US payrolls report last Friday. This followed an early London test on the support seen ahead of 1.1000, contained to 1.1042 and now set to the mid 1.1100s.
AUD now weighed by rate cut expectations in Aug and outperformed by NZD, which has eked.