USD/CAD steady at 1.4350 as BOC holds rates at 2.75% as expected

USD/CAD remained stable near 1.4350 following the Bank of Canada's decision to maintain interest rates at 2.75%, in line with market expectations. The Canadian dollar showed limited reaction as traders had already priced in the hold, with only a 26% probability of a cut anticipated. The central bank's statement maintained a cautious tone on inflation, suggesting rates may remain elevated through Q3 2025. Market focus now shifts to the July 30 BOC meeting, where economists see a higher probability of policy adjustment. Oil prices at $72.50/barrel are providing moderate support for CAD, offsetting some dollar strength. Technical analysis shows USD/CAD consolidating between 1.4320 support and 1.4380 resistance. A decisive break above resistance could target 1.4420, while failure to hold support may see a retest of 1.4280. The pair's direction will likely depend on upcoming Canadian employment data and oil price movements.