The monetary policy committee at the Bank of Canada decided after the conclusion of its meeting held today, Wednesday, to lower interest rates by about 25 basis points, marking the first reduction since March 2020, thus stabilizing the key interest rate at 4.75%, in line with market expectations that indicated the Bank of Canada would lower the interest rate during this meeting.

Within a few minutes, investors are awaiting the release of the interest rate statement from the monetary policy committee at the Bank of Canada, which provides a clearer picture of the Bank of Canada's decisions and the economic situation within the country, which has a strong impact on Canadian dollar trading against other currencies.

It is worth noting that the Bank of Canada makes the interest rate decision related to overnight funding rates between major financial institutions in the country. Traders are watching for changes in interest rates, as short-term interest rates measure the value of the currency. The higher the interest rates rise beyond expectations, the more positive it is for the Canadian dollar; conversely, if they fall more than expected, it negatively impacts the Canadian dollar.