The Canadian Dollar in today's trading flows fell after the Canadian central bank expected to pause rate hikes if economic developments remained broadly in line with its outlook so that this condition makes the Bank of Canada get the full attention of the Canadian public.

The Bank of Canada has raised the overnight rate by 25 bps to 4.5 per cent. This financial condition remains restrictive but has eased since October. The BoC noted that the Canadian Dollar has been more stable against the USD when compared to the previous period.

The Central Bank expects global economic growth to decline and slow down to 2% in 2023 and 2.5% in 2024. So many economists are starting to adjust these notes with their bookmarks, especially regarding the movement of the Canadian Dollar.

"IN Canada, recent economic growth has been stronger than expected. The economy remains in excess demand. Meanwhile, the labour market is also still tight. However, there is growing evidence that restrictive monetary policy is slowing activity," said the economists.

Bank of Canada Hikes Rates and Became the First Major Bank to Implement the Signal "Conditional" Pause

Meanwhile, on Thursday, the Bank of Canada hiked its fundamental interest to 4.5%, the highest value in 15 years. This is also the first major central bank fighting global inflation to say it would likely hold off on further increases, at least until now.

The 25-base pint rise is also what experts expect. The bank has lifted rates at a record pace of 425 basis points in the last ten months. All of this was done solely to tame inflation which had peaked at 8.1 per cent but now has also subsided.

However, the Canadian bank's target is to see inflation at 2%/Canada's approach to achieving this is also considered quite extreme. This is evidenced by the Bank of Canada, which carried out rate hikes, but also became the central bank which implemented the conditional pause.

"We are turning the corner on inflation. We are still a long way from our target, but recent developments have reinforced our confidence that inflation is coming down," said Bank of Canada Governor Tiff Macklem to reporters who asked about Canada's fate.

Meanwhile, the head of a Canadian analyst firm's macro strategy said this was a conditional pause. He said that there were upside risks to this outlook. However, he considered Canada's preparations for this matter good.

The central bank had said in December that the future rate decision would be in data depends. This is a blowout for the December employment report, which was also recently released so that the upside risk to wage and price growth after this Central Bank policy will be seen.

Canada's Economy Is In The Turbulent Zone This Year, So What Does This Mean For Canadians?

"it's far too early to be talking about cuts. The pause is designed to give us time to assess whether we have raised interest rate enough o get inflation back to target," said Macklem, discussing some relief that the Canadian Dollar might need.

However, many are also curious about what all this means. The up-and-down movement that the Canadian Dollar experienced with Canada gave the country a big question mark. But by looking at that condition, there still needs to be a clear sign for further contribution.

However, the effects of this can already be seen, with 22 per cent of Canadians saying that they are now living entirely out of money. The rising unemployment rate makes Canada try hard to overcome the current conditions.

The key policy rate, also known as the overnight rate, is what the Bank of Canada is currently implementing. Mainly because of their condition that they want to bring money overnight to settle daily balances; unexpectedly, this is what endangers the Canadian economy.