Home Daily Commentaries Canadian inflation jumps again

Canadian inflation jumps again

Daily Currency Update

Canada's inflation rate rose again, climbing to 8.1% in June, according to Statistics Canada. The Canadian dollar weakened against the US dollar following Wednesday's report, but has pared its losses on Thursday thanks mostly to broad USD weakness. Gasoline was a big factor in the overall inflation rate going up, with prices up by 54.6% vs the previous year. Last week, the Bank of Canada delivered a supersized interest rate decision, hiking a full percentage point in a bid to bring down rising prices. USDCAD was trading around 1.2882 at the time of writing.


Key Movers

The European Central Bank (ECB) raised interest rates for the first time since 2011 on Thursday, finally joining many major central banks in taking action to curb inflation that's at multi-decade highs. The ECB hiked interest rates by 50 basis points, bringing the deposit rate to 0% and the main rate to 0.5%. This was a bigger move than widely expected, especially with the ECB's previous guidance. Like the Bank of England, the ECB is in a tricky position of having to fight inflation while its economy slows in the face of uncertainty over its supply of energy from Russia. The euro jumped against the US dollar, breaching past 1.02 shortly after the decision. However it has slipped back below 1.02 again, trading around 1.0194 at the time of writing.



Expected Ranges

  • EUR/CAD: 1.3102 - 1.3245 ▲
  • GBP/CAD: 1.5388 - 1.5455 ▼
  • AUD/CAD: 0.8863 - 0.8907 ▲
  • USD/CAD: 1.286 - 1.2929 ▲