This week’s economic data will likely reinforce short-term expectations of higher inflation, Canada has its Consumer Price Index on Wednesday and Retail Sales on Friday. While the U.S. has FOMC minutes, Phiily Fed Index, Housing Starts and Existing Home Sales, all of which will provide more reasons for higher inflation. Most commodities are still trading at recent highs while others such as lumber remains unchanged but with a downward bias.
The Canadian dollar has most analysts scratching their heads, theoretically the Canadian dollar should start to weaken on impeding inflation woes but its resilience too strong to ignore. If you are negative on the Canadian dollar, bide your time, you may miss the bottom, but it’s a long way back to 1.3000.
Currently* Close Range
USDCAD 1.2073 1.2102 1.2071-1.2136
EURCAD 1.4674 1.4682 1.4668-1.4742
GBPCAD 1.7055 1.7042 1.7031-1.7099
*Indicative rates only
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