Loonie impacted by FOMC prolonging stimulus

The value of the Canadian dollar climbed from its session-low on Wednesday against its southerly rival in response to the U.S. Federal Reserve opting to prolong an economy-spurring measure, according to Reuters.

The loonie benefited from the move from the Federal Open Market Committee, which was anticipated. Operation Twist, as the stimulus program is known, was set to run its course through the end of this month. Rather, now the program will be extended.

"There's volatility around any Fed decision and today's is no different ... equity markets were clearly too bullish and expectations had been raised too much and now we're seeing negativity but it could be short-lived," managing director of foreign exchange Jack Spitz with National Bank Financial told Reuters on Wednesday.

Prior to the upward bounce of the Canadian dollar, the monetary unit already had been performing strongly as it touched its top value in four weeks against the U.S. dollar. But then it lost value as the announcement neared.

Losses to the Canadian dollar on Wednesday also were attributable to crude oil futures dipping, Bloomberg reports. The energy commodity is the natural-resources-rich nation's top commodity.