Breaking News
0

Canadian Dollar Tests 1.32, U.S Consumer Inflation Next

By Market Pulse (Kenny Fisher)ForexJan 11, 2019 08:14AM ET
www.investing.com/analysis/usdcad--canadian-dollar-tests-132-us-consumer-inflation-next-200374694
Canadian Dollar Tests 1.32, U.S Consumer Inflation Next
By Market Pulse (Kenny Fisher)   |  Jan 11, 2019 08:14AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

It’s been an excellent week for the Canadian dollar, and the currency has posted slight gains on Friday. In the North American session, the pair is trading at 1.3215, down 0.16% on the day. On the release front, there are no Canadian events. Investors are bracing for weak inflation numbers out of the United States. CPI is expected to drop to -0.1%, while Core CPI is forecast to remain steady at 0.1%.

The Federal Reserve is sounding much more dovish of late, after a hawkish rate statement in December sent equity markets plunging in late December. The minutes from that meeting noted that low inflation levels meant that the Fed could “afford to be patient about further policy firming”. Even more striking, the minutes revealed that at the December meeting, some policymakers opposed a rate hike, arguing that inflation was too low to warrant higher rates. The US Dollar responded to the minutes with broad losses on Wednesday. On Thursday, Fed Chair Jerome Powell said he was “very worried” about the massive U.S. debt and reiterated that the Fed would remain patient on monetary policy. Given that further interest rate hikes would hurt the debt burden of corporate borrowers, Powell’s remarks on the debt could be a sign that the Fed will take a pause on rate hikes in the near future, and perhaps even entertain a rate cut this year.

The Bank of Canada held the benchmark rate at 1.75% on Wednesday, which is unchanged since October. The bank policy statement was somewhat on the dovish side, as policymakers highlighted their concerns for the economy. These included low oil prices, an overpriced housing market and the global trade war. The Canadian economy is highly dependent on exports, and a weaker global economy has put a crimp in the export sector. The Canadian dollar had a dismal 2018, falling 8.4%. However, it’s been a stellar January for the currency, which has jumped 3.0%, recovering the losses seen in December. The loonie is sensitive to the movement in equity markets, and higher risk appetite has boosted the currency. The BoC remains cautious, and is likely to hold off on interest rate hikes until the current turmoil in the equity markets eases.

USD/CAD Fundamentals

Friday (January 11)

  • 8:30 US CPI. Estimate -0.1%
  • 8:30 US Core CPI. Estimate 0.2%
  • 14:00 US Federal Budget. Estimate -8.08B

*Key events are in bold

USD/CAD for Friday, January 11, 2019

USD/CAD Chart
USD/CAD Chart

USD/CAD, January 11 at 8:00 EST

Open: 1.3235 High: 1.3245 Low: 1.3183 Close: 1.3215

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.3049 1.3125 1.3200 1.3290 1.3383 1.3461

USD/CAD posted slight losses in the Asian session. In European trade, the pair posted headed lower but has recovered

  • 1.3200 was tested earlier in support and remains a weak line. It could break in the North American session
  • 1.3290 is the next resistance line
  • Current range: 1.3200 to 1.3290

Further levels in both directions:

  • Below: 1.3200, 1.3125 and 1.3049
  • Above: 1.3290, 1.3383, 1.3461 and 1.3552

Original post

Canadian Dollar Tests 1.32, U.S Consumer Inflation Next
 
Canadian Dollar Tests 1.32, U.S Consumer Inflation Next

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email