CPI numbers and a tight national election hold back the Loonie’s rally.
Wednesday 16 October, 2019
Daily Currency UpdateCAD - Canadian DollarThe Loonie trades lower at 0.7562 (the USD/CAD pair increases 0.18 percent towards 1.3223) following the Statistics Canada announcement regarding the Consumer Price Index (CPI). The CPI rose 1.9 percent on a year-over-year basis in September, matching the increase in August; however, the forecast had an inflation rate of 2.1 percent. This difference negatively impacted the Loonie in the FX market. Excluding gasoline, the CPI rose 2.4 percent for the third consecutive month. On a seasonally adjusted monthly basis, the CPI edged down 0.1 percent in September, matching the decline in August. The Bank of Canada's next rate decision is set for Oct. 30th. Canada is in the middle of a tight national election campaign, and the vote will finalize on Oct. 21st. Polls are showing the governing Liberals are in a tie with the opposition Conservatives, who have focused their campaign on issues related to the cost-of-living and affordability. Technically speaking, the USD/CAD pair trades in a consolidation mode, which means that it might trade in a range between 1.3191 and 1.3241 in the next few hours before taking a clear direction.
Key MoversThe British Pound continues trading with each new set of headlines; it is moving 0.34 percent higher, trading at 1.2824 at the time of this writing. An optimistic Michel Barnier is the primary driver of the cable rally this morning. Barnier has told EU Commissioners he is confident of getting a deal done today. However, the full thread makes a mention that there are still outstanding issues yet to be resolved, and it could go right down to the wire. Barnier will still brief EU ambassadors later today. At the same time, according to The Guardian, EU sources said an extension to Britain's withdrawal beyond Oct. 31st may still be required if an agreement is secured.
- USD/CAD: 1.3191 - 1.3241 ▲
- EUR/CAD: 1.4544 - 1.4640 ▲
- GBP/CAD: 1.6791 - 1.7000 ▲
- AUD/CAD: 0.8837 - 0.8911 ▼
- NZD/CAD: 0.8239 - 0.8314 ▼