Canadian Dollar Unchanged but Facing Headwinds

Key Movers

American markets are in a holding pattern this morning with the focus squarely on inflation.  In the lens today is the US Producer Price Index which came in at 8.5% year over year with a core number at 7.2%.  Later today, we have the release of the minutes from the last FOMC meeting.  Investors will be interested to see any clues to where the Fed thinks inflation will peak.  There is some indication this has already happened. The PPI index has not continued to rise, and pressures are seemingly waning on the supply chain globally.

The Euro is staying steady this morning but could be facing headwinds soon.  The European currency is trading relatively the same as yesterday versus the USD.  Concerns are coming out though about the ability to provide energy to the continent heading into winter.  Energy ministers are meeting in Prague to discuss finding alternate supplies of natural gas now that the Nordstream pipeline has been shut off by Russia.

The GBP is regaining yesterday’s losses although the focus in the UK is not on the currency but on the government bonds, or “GILTS”.  The Bank of England Governor Andrew Bailey warned this morning that the current gilt-buying program is up on Friday and that investors only have 3 days to get involved.