USD/CAD Achieves C$1.1200 on Strong CPI Data
- Canadian Consumer Price Index data shows inflation matches highest since 2012
- Inflation beats market expectations and puts pressure on the Bank of Canada
CAD Consumer Price Index beat analyst estimates with a headline reading of 2.4% versus expectations of 2.1%. CAD CPI has been stagnant over the past three releases and the trend was expected to continue. The biggest sector contributors to the strong CPI headline reading was Clothing/Footwear and Household Operations.
Canada is currently the only G10 country with inflation above the desired target level. They currently have an actual inflation rate of 2.4%. Continued increase in prices and rising inflation could pressure the Bank of Canada to consider an interest rate increase in the future.
Here’s a summary of the data this morning that’s stoked the strength in the Canadian Dollar:
- CAD Bank Canada Consumer Price Index Core (OCT): 2.3% actual versus 2.1% expected, from 2.1% (y/y).
- CAD Consumer Price Index (OCT): 2.4% versus 2.1% expected, from 2.0% (y/y).
- CAD Bank Canada Consumer Price Index Core (OCT): 0.3% versus 0.2% expected, from 0.2% (m/m).
- CAD Consumer Price Index (OCT): 0.1% actual vs -0.2% expected, from 0.1%.
-CAD CPI Core SA (OCT): 0.2% versus 0.1% expected, from 0.2% (m/m).
-CAD CPI SA (OCT): 0.1% versus -0.1% expected, from 0.2% (m/m).
-CAD Consumer Price Index (OCT): 125.9 versus 125.4 expected, from 125.8.
USDCAD 1-minute Chart: November 21st, 2014 Intraday
Charts Created using Marketscope – prepared by Tyler Amend
USDCAD fell to a low of 1.1191 on CAD strength before finding support. USDCAD fell through the 1.200 handle and promptly traded back above. The pair has fallen into a choppy pattern and is currently trading at 1.1220 at the time of this report.
--- Written by Tyler Amend, DailyFX Research
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