Canadian CPI Overview
Wednesday's economic docket highlights the release of Canadian consumer inflation figures for the month of January, scheduled to be published at 13:30 GMT. The headline CPI is anticipated to have ticked higher 0.% m/m and the yearly rate is anticipated to have decelerated to 1.5% in the reported month.
Deviation impact on USD/CAD
Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction on the pair is likely to be around 26-pips during the first 15-minutes and could get extended to 45-pips in the following 4-hours in case of a relative deviation of -1.02.
How could it affect USD/CAD?
Ahead of the important release, the pair was seen holding weaker around the 1.3135-30 region and a follow-through selling, led by any positive surprise from the inflation figures, might turn the pair vulnerable to break through the 1.3100 handle and slide further towards testing monthly swing lows, around the 1.3070-65 region.
Alternatively, a weaker reading might exert some downward pressure on the Canadian Dollar and prompt a short-covering bounce towards the 1.3185 horizontal resistance. The momentum could further inspire bulls to retake the 1.3200 handle and aim towards challenging 10-day SMA, around mid-1.3200s.
Key Notes
• USD/CAD falls to session lows amid surging oil prices, Canadian CPI in focus
• Market themes of the Day: Powell's testimony 2.0 and Canada's core inflation headline
About BoC's Core CPI
Consumer Price Index Core is released by the Bank of Canada. “Core” CPI excludes fruits, vegetables, gasoline, fuel oil, natural gas, mortgage interest, intercity transportation, and tobacco products. These volatile core 8 are considered as the key indicator for inflation in Canada. Generally speaking, a high reading anticipates a hawkish attitude by the BoC, and that is said to be positive (or bullish) for the CAD.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays in daily range slightly below 1.0900
EUR/USD continues to move up and down in a narrow band slightly below 1.0900 in the second half of the day on Monday. The modest improvement seen in risk mood makes it difficult for the US Dollar to find demand and helps the pair stay in range.
GBP/USD treads water above 1.2900 amid risk recovery
GBP/USD is keeping its range play intact above 1.2900 in the American session on Monday. The positive shift seen in risk sentiment doesn't allow the US Dollar to gather strength and helps the pair hold its ground ahead of this week's key data releases.
Gold struggles to hold above $2,400
Gold loses its traction and trades in negative territory below $2,400 after suffering large losses in the second half of the previous week. The benchmark 10-year US Treasury bond yield holds above 4.2% and risk flows return to markets, not allowing XAU/USD to rebound.
Solana could cross $200 if these three conditions are met
Solana corrects lower at around $180 and halts its rally towards the psychologically important $200 level early on Monday. The Ethereum competitor has noted a consistent increase in the number of active and new addresses in its network throughout July.
Election volatility and tech earnings take centre stage
/stock-market-graph-gm532464153-55981218_XtraSmall.jpg)
The US Dollar managed to end the week higher as Trump Trades ensued. Safe-havens CHF and JPY were also higher while activity currencies such as NOK and NZD underperformed.