CAD dips as USD gains amid inflation release
Wednesday 15 February, 2023
Daily Currency UpdateThe Canadian dollar is on the back foot to start the day, losing close to a cent from yesterday’s highs against the USD. This is following the trend of riskier assets as equities and commodities are also down to start the day. The main reason for this is major markets digesting higher-than-expected inflation in the US. The West Texas Intermediate oil price is back into the $78 a barrel range and all the North American indices are pointing towards a weaker open.
Key MoversThe US Dollar is up significantly to start the day against most major currencies. This growth follows yesterday’s release of the January Consumer Price (CPI) data. The report showed headline inflation has dropped to 5.6% from the previous 5.7%. This dip, however, was not as significant as markets were expecting. The markets are now pricing in an additional rate hike from the Federal Reserve meaning rates in the US may increase another 0.50%. The US also saw better-than-expected retail sales in January with purchases growing 3% over last year.
The British pound, and most major currencies, lost ground to the greenback overnight but regained some after inflation in the United Kingdom dropped more than expected. Price increases dropped more than anticipated from 10.5% to 10.1% versus an expected 10.3%.
- EUR/CAD: 1.4313 - 1.4374 ▲
- GBP/CAD: 1.6128 - 1.6276 ▼
- AUD/CAD: 0.9234 - 0.9327 ▼
- USD/CAD: 1.3313 - 1.3421 ▲