The Canadian dollar depreciated vis-à-vis the U.S. dollar today as the greenback tested offers around the C$ 1.2695 level and was supported around the C$ 1.2530 level. Bank of Canada reduced its overnight rate by 50bps today to 1% and the Bank Rate now stands at 1.25%. BoC reported The outlook for the global economy has deteriorated since the Bank's December interest rate announcement, with the intensifying financial crisis spilling over into real economic activity. Heightened uncertainty is undermining business and household confidence worldwide and further eroding domestic demand. Major advanced economies, including Canada's, are now in recession and emerging-market economies are increasingly affected. Most traders believe BoC may be forced to ease rates further. Data released in Canada today saw November manufacturing shipments off 6.4%. U.S. dollar bids are cited around the C$ 1.2400 figure.
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