Canadian Dollar Rises Sharply as Consumer Inflation Beats Expectations

The Canadian dollar was firm today after nation’s consumer inflation accelerated and beat analysts’ expectations. The rally of crude oil prices likely also helped the currency.
Statistics Canada reported that the Consumer Price Index rose 2.4% in May, year-over-year, after rising 2.0% in April. The gains were broad-based, including higher prices for food and durable goods, while prices for gasoline declined. Month-on-month, the index was up 0.4%, without seasonal adjustments (0.3% seasonally adjusted). That was the same rate of growth as in April and faster than the predicted pace of 0.1%.
Analysts speculated that the positive data eased pressure on the Bank of Canada to cut interest rates.
North American crude oil rallied 0.37% in New York today, erasing earlier losses. Curiously, international benchmark Brent crude failed to join the rally.
USD/CAD sank from 1.3376 to 1.3298 as of 19:47 GMT today. EUR/CAD dropped from 1.4970 to 1.4933, retreating from the daily maximum of 1.4999. CAD/JPY advanced from 81.05 to 81.29.

If you have any questions, comments, or opinions regarding the Canadian Dollar, feel free to post them using the commentary form below.

Leave a Reply

Your email address will not be published. Required fields are marked *