Bank of Canada announced the biggest interest rate increase since 2000

😲Bank of Canada announced the biggest interest rate increase since 2000🤪

On Wednesday, the Bank of Canada announced that policy rates would be increased by 50 basis points to one percent to dial back the easy monetary policy during the pandemic era that has caused the hottest inflation in North America in the past 40 years.

The Canadian dollar gained against the US dollar initially. Still, the US dollar appreciated to 1.26 CAD by the end of Thursday. Investors are betting that the US central bank will introduce similar hikes in their next meeting, supporting the already over-valued US dollar.

 US equity markets continued their downward trend on Thursday, and the 10-year Treasury yield topped 2.8% in anticipation of the future interest rate increase. The tech shares led to the decline as the richest man in the world, Elon Musk, put forward a hostile takeover bid on Twitter, making investors more nervous. Musk announced at the beginning of the month that he owns more than a 9% stake in the company and rejected the seat on the board of directors offered by the Twitter management.

 Although short-term futures contracts are pointing at around 80, oil prices continue to stay above the 100 threshold, with West Texas Intermediate increasing 1.9% today to 106.2 a barrel.