The Euro pares early losses against the Canadian Dollar amid reduced Middle East conflict concerns and ahead of the Bank of Canada policy announcement.
The Euro recovered from early losses to trade slightly positive at 1.6170 against the Canadian Dollar during Monday’s European session. The rebound follows a broad-based Euro recovery as markets dial back concerns over escalating Middle East tensions, which had weighed on risk sentiment earlier in the day.
Prior to the rebound, EUR/CAD dipped below 1.6150, extending a week-long decline driven by expectations of divergent monetary policy between the European Central Bank and the Bank of Canada. The cross remains near its lowest levels since mid-April, with traders closely watching Wednesday’s BoC rate decision for potential policy shifts.
No immediate market reaction was reported following the rebound, though volatility is expected to pick up ahead of the BoC announcement and key Eurozone inflation data later this week.