News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Mixed
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Real Time News
  • US Dollar pushing higher against major FX peers on the back of global PMI data. Get your $USD market update from @RichDvorakFX here: https://t.co/BENtqHDWyN https://t.co/SgCvMp0UwS
  • Fed's Rosengren says achieving 2% inflation in 4 years would be a matter of luck - BBG
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.16%, while traders in NZD/USD are at opposite extremes with 64.95%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/vVgLKSkG2U
  • Gold on pace for another big decline today, support levels are falling fast. ~1800 is the next major area to keep an eye on in my opinion #Gold $XAU https://t.co/mOjSGm2snA
  • Commodities Update: As of 16:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.35% Gold: -1.88% Silver: -5.43% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/dpJL9GNED0
  • Gold prices have been showing bearish tendencies for the better part of the past seven weeks, coming fresh on the heels of all-time-highs that printed in early-August. Get your $XAUUSD market update from @JStanleyFX here:https://t.co/ucxIo1pFfg https://t.co/aHUhmb8YVK
  • Forex Update: As of 16:00, these are your best and worst performers based on the London trading schedule: 🇬🇧GBP: 0.20% 🇪🇺EUR: -0.26% 🇨🇭CHF: -0.35% 🇨🇦CAD: -0.44% 🇳🇿NZD: -0.99% 🇦🇺AUD: -1.00% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/3KGtHyMLEM
  • Fed's Rosengren says he is less optimistic against other forecasters in Fed - BBG
  • Fed Chair Powell: - Studying what caused dysfunction in Treasury market back in March - DJ via BBG
  • Indices Update: As of 16:00, these are your best and worst performers based on the London trading schedule: France 40: -0.25% Germany 30: -0.33% FTSE 100: -0.36% Wall Street: -0.48% US 500: -0.84% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/0ZaXkoSq3u
USD/CAD to Eye Downside Targets on Sticky Canada Inflation

USD/CAD to Eye Downside Targets on Sticky Canada Inflation

2016-07-16 00:12:00
David Song, Strategist
Share:
USD/CAD to Eye Downside Targets on Sticky Canada Inflation

Fundamental Forecast for CAD: Bullish

For more updates, sign up for David's e-mail distribution list.

USD/CAD may continue to give back the advance carried over from the previous month as the Bank of Canada (BoC) softens its dovish outlook for monetary policy, but the fresh data prints coming out of the region may dampen the appeal of the loonie as the central bank warns ‘the output gap will close somewhat later than estimated in April, towards the end of 2017.’

Even though the BoC sees ‘above-potential growth from the second half of 2016, lifted by rising US demand and supported by accommodative monetary and financial conditions,’ a slowdown in Canada Retail Sales accompanied by a downtick in the Core Consumer Price Index (CPI) may produce near-term headwinds for the Canadian dollar as it puts pressure on the central bank to further support the real economy. The ongoing adjustment to the oil-price shock accompanied by the weakening outlook for global growth may push BoC Governor Stephen Poloz to preserve a cautious tone at the next interest-rate decision on September 7, but the central bank may have little choice but to gradually move away from its easing cycle should price growth continue to exceed expectations.

Indeed, the BoC argued ‘inflation has recently been a little higher than anticipated, largely due to higher consumer energy prices,’ and a stronger-than-expected CPI report may spur a further shift in the monetary policy outlook especially as the central bank anticipates a ‘pickup in growth over the projection horizon.’ With that said, Governor Poloz may adopt a hawkish tone over the coming months should the key data prints coming out of the Canadian economy boost the outlook for growth and inflation.

USD/CAD to Eye Downside Targets on Sticky Canada Inflation

As a result, USD/CAD may threaten the July low (1.2830) as the pair continues to find resistance around 1.3130 (38.2% retracement), and a break of the monthly opening range may open up the downside targets, with support coming in around 1.2620 (50% retracement) to 1.2650 (50% retracement). - DS

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES