Loonie Traders Bet on Steady Outlook Despite BOC Path

Options traders are looking beyond Wednesday’s Bank of Canada decision and betting on a relatively steady outlook for the loonie in the days ahead, without or without an interest-rate cut.

The Canadian currency fell about 0.6% versus the greenback on Tuesday, posting its first decline in five days amid weaker-than-expected inflation data. Still, the loonie has advanced about 3% versus the greenback so far this month, on track for a third straight month of gains and also poised for the biggest monthly rally since June 2019.