Yesterday the Federal Reserve cut the interest rate by 0.25% from 4.50%-4.75% to 4.25%-4.50%, as previously forecast. Despite this decision by the regulator, the US currency strengthened, and some currency pairs are nearing multi-year highs. For instance, the USD/CAD pair is trading near its 2020 highs, GBP/USD has dropped below 1.2600, and EUR/USD is approaching this year's lows near 1.0330.

USD/CAD

After confidently breaking above the psychological level of 1.4000, the USD/CAD pair has been strengthening for four consecutive weeks. According to technical analysis, the uptrend could continue towards 1.4600-1.4700. At the same time, a downward correction to 1.4270-1.4360 cannot be ruled out, provided reversal patterns form on higher timeframes.

Key upcoming events that could impact the pair's direction include:

• Today at 15:30 (GMT+2): US Q3 GDP data,
• Today at 15:30 (GMT+2): Philadelphia Fed Manufacturing Index (US),
• Today at 17:00 (GMT+2): US Existing Home Sales data.

GBP/USD

Yesterday, the GBP/USD currency pair sharply declined after retesting 1.2720, although this year's lows remain untouched. Investors are likely awaiting the market's reaction to today's Bank of England meeting. According to expert forecasts, the interest rate is expected to remain at 4.75%. A crucial factor for the pair's price movement will be the number of committee members voting for a rate cut. If the rate is unexpectedly reduced or if more than two members vote for a cut, GBP's value could decline.

In addition to the Bank of England meeting, the following events are critical for GBP/USD:

• Today at 07:30 (GMT+2): UK New Car Registrations,
• Tomorrow at 09:00 (GMT+2): UK Core Retail Sales Index,
• Tomorrow at 13:00 (GMT+2): UK CBI Industrial Trends Orders Index.

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