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Rising Canadian Core Inflation Fails to Boost CAD

Friday’s high: C$1.6923

Friday’s low: C$1.6811

Canadian Inflation Report Meets Forecasts

The Pound to Canadian Dollar exchange rate sustained around a cent in gains last week, as Sterling continued to advance while domestic Canadian data failed to boost demand for the ‘Loonie’. Demand for the risky Canadian Dollar was also held back by poor commodity news and US political uncertainties.

Canada’s October Consumer Price Index (CPI) results met expectations in both major prints. The monthly inflation rate slowed to 0.1% as forecast, while the yearly rate slowed to 1.4%.

However, the core yearly inflation rate did rise slightly, from 0.8% to 0.9%, suggesting that underlying inflation trends were strengthening.

Due to market anticipation for Brexit news, Sterling easily gained against a weak Canadian Dollar last week.

CAD Outlook: Brexit and Budget News in Focus

The coming week’s Canadian economic calendar is relatively sparse, so the Pound is likely to take focus in GBP/CAD exchange rate movement.

Investors are likely to digest any of the weekend’s Brexit news for most of Monday’s session, but after that traders will become more focused on the upcoming Autumn Budget.

Britain’s latest public sector net borrowing report will be published on Tuesday and the Autumn Budget will be presented by UK Chancellor Philip Hammond on Wednesday. If the Budget includes any new infrastructure plans, this could give Sterling a boost.

Thursday will see the publication of the week’s most influential data, including UK growth projections and Canada’s September retail sales report.

Key Events

21st November

09:30 UK Public Sector Net Borrowing

13:30 Canadian Wholesale Sales

22nd November

UK Autumn Budget

16:00 Canadian Budget Balance

23rd November

09:30 UK Growth Rate

09:30 UK Business Investment

13:30 Canadian Retail Sales

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To keep up to date with the Canadian Dollar, visit the CAD blog in our Currency News section.

Richard Beaumont

Currency Broker
T: +44(0)1442 892 060

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