CAD lower ahead of Fed decision
Wednesday 15 December, 2021
Daily Currency UpdateDemand for the Canadian dollar slumped to around three-month lows against the US dollar as oil prices fell and data showed that consumer price inflation held at the highest level in almost two decades last month. Annual inflation was 4.7% in November, unchanged from the 4.7% annual pace of price gain in October, according to Statistics Canada. This could add to pressure on the Bank of Canada to start raising interest rates faster. USDCAD was up 0.42% at around 1.29137 at the time of writing.
Key MoversThe US dollar was little change on Wednesday as investors waited for the US Federal Reserve's latest monetary policy update. After last week’s softer than expected CPI print, a robust US PPI print reignited inflation jitters, confirming expectations the Fed will announce an accelerated plan to monetary policy normalization. The market has high expectations for a definitive and perhaps aggressive policy shift and any sense the Fed has fallen short in meeting expectations could drive USD weakness, while a more aggressive plan could fuel further dollar gains. The US Dollar Index was sitting at 96.58 at the time of writing. GBPUSD climbed to a weekly high of 1.3265 on the back of data showing soaring inflation in the UK, but the pound lost momentum and retraced as investors waited for the Fed decision. GBPUSD sat around 1.3215 while EURUSD was trading around 1.1258 at the time of writing.
- EUR/CAD: 1.4467 - 1.4544 ▲
- GBP/CAD: 1.6993 - 1.7084 ▲
- AUD/CAD: 0.9129 - 0.9206 ▲
- USD/CAD: 1.2846 - 1.2919 ▲