CAD CPI: What to Expect of USD/CAD

CAD CPI: What to Expect of USD/CAD

20 May 2016, 13:22
Roberto Jacobs
0
7

CAD CPI: What to Expect of USD/CAD

Canadian inflation figures for the month of April are due later in the NA session, with market consensus expecting headline consumer prices to have gained 0.3% on a monthly basis, mainly backed by increasing gasoline prices. Core prices are seen rising 0.1% inter-month and 2.0% over the last twelve months.

All in all, and as strategists at TD Securities put it “this data print will do little to challenge the prevailing macro narrative and outlook for the overnight rate”.

Regarding CAD, crude oil dynamics remain the exclusive driver, while a repricing of the Fed’s expectations of a rate hike next month – backed by data and hawkish comments by FOMC members/minutes – keeps fuelling the rally in the US dollar and lifting USD/CAD to fresh 6-week tops above the 1.3100 handle.

The next up barrier is located at yesterday’s high at 1.3155, followed by April’s top at 1.3219 and then 1.3312, the 38.2% Fibo retracement of the January-May decline. On the downside, there seems to be decent support around the area of 1.2986/60, where sits he 23.6% Fibo retracement of the January-May down move and the 55-day sma.


fxs_logo_news.png

Share it with friends: