Rising CPI Doesn’t Help Canadian Dollar

The Canadian dollar fell against its US counterpart today despite positive macroeconomic data from Canada. The currency also retreated against the Japanese yen but gained on the very weak euro.
Canada’s Consumer Price Index fell 0.2 percent in January while the core CPI rose at the same rate. The data was not stellar, yet it was still better than analysts’ forecast. Year-on-year, consumer prices grew 1 percent.
The Canadian currency got little help from the positive inflation report. The most likely reason for this is the drop of crude oil price. At the same time, the Canadian dollar outperformed the euro which was weakened by lingering concerns about Greece and its place in the eurozone.
USD/CAD advanced from 1.2433 to 1.2520 as of 21:31 GMT today. CAD/JPY ticked down from 95.54 to 95.38. Meanwhile, EUR/CAD tumbled from 1.4121 to 1.4013, and its daily low of 1.3979 was the weakest rate since January 26.

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