CAD unchanged as CPI numbers hold steady
Wednesday 16 November, 2022
Daily Currency UpdateThe CAD is holding position against the USD as inflation in Canada came in this morning at 6.9%, unchanged from last month and in line with expectation. Markets are still expecting a 50 point from the Bank of Canada at their next announcement in early December.
Key MoversThe USD is holding position against most majors this morning after US retail sales for October came in at 1.3% up versus a consensus 1.0%. The mini USD bump seen yesterday has subsided in the overnights as reports came out that the missiles mistakenly shot into Poland were not Russian. They were instead misfires by Ukrainian forces. With the USD facing increased selling pressure, the euro and Japanese yen enjoyed modest gains while the GBP continued its steep upward run. The pound has been a primary benefactor of recent US dollar weakness. A stronger-than-anticipated labour market print helped propel the pound through £1.20 overnight before reversing course to close 1% higher on the day at £1.1880. Despite the economy tumbling into recession and increasing signs of rising inflation, chronic job shortages, and a lack of consumer-led activity starting to bite, the GBP has proved remarkably resilient since the budget turmoil. While we anticipate economic headwinds will soon impact GBP value, there are near-term upside opportunities as the markets focus on shifting Fed policy expectations. Our attention today turns to UK CPI inflation data and US retail sales. As higher energy costs fuel inflation, UK price pressures are expected to remain elevated. With the headline, CPI is tipped to print at or near 10.7%; a miss could drive significant price action.
- EUR/CAD: 1.3708 - 1.3836 ▲
- GBP/CAD: 1.5721 - 1.5850 ▲
- AUD/CAD: 0.8958 - 0.9015 ▲
- USD/CAD: 1.3232 - 1.3325 ▼