Week in FX Americas – Loonie Takes Flight In Wrong Direction

Another benign inflation reading from Canada has the CAD ending the week extending its losses above parity outright. The country’s core-inflation rose by an annualized pace or +1.1% on Friday, well below Governor Carney and the Bank of Canada’s medium term inflation target of +2%. So far the week the loonies plight has fallen -1.47% against its largest trading partner, south of the 49th parallel.

Yesterday’s inflation report was closely watched especially after the Banks MPR report mid week suggested that “muted” inflation is a factor that would suggest that rate increases are “less imminent.” The domestic economy is obviously slowing, but at what pace? Governor Carney’s less hawkish stance coupled with a commodity sector with its own troubles has the ability to push USD/CAD towards techies short term target of 1.0250.

 

WEEK AHEAD

* USD Gross Domestic Product Annualized
* USD Fed Interest Rate Decision
* USD Fed's Monetary Policy Statement and press conference
* NZD Monetary Policy Statement
* NZD RBNZ Interest Rate Decision
* EUR Consumer Price Index
* EUR Harmonised Index of Consumer Prices
* USD Core Personal Consumption Expenditure - Prices Index
* USD Nonfarm Payrolls
* USD Unemployment Rate

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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Dean Popplewell

Dean Popplewell

Vice-President of Currency Analysis and Research at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell
Dean Popplewell

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