The Canadian dollar has posted slight losses in the Wednesday session. Currently, USD/CAD is trading at 1.3154, up 0.31% on the day. On the release front, in the U.S., the focus is on inflation reports, with PPI and Core PPI both expected to soften to 0.2%. The Bank of Canada will set the benchmark rate and release a rate statement. On Thursday, Canada publishes New Housing Price Index. The U.S. will release CPI and Final CPI as well as unemployment claims.
The spotlight is on the Bank of Canada, which holds its monthly rate meeting on Wednesday. The markets are expecting that bank policy-makers will raise rates by a quarter-point to 1.50%, a level not seen since December 2008. Earlier this month, BoC Governor Stephen Poloz said that the July rate decision would be based on economic data, and Friday’s strong employment data will be added ammunition in favor of raising rates at the upcoming meeting. The economy created 31,800 jobs in June, well above the estimate of 22,300. Wage growth also looked strong, as hourly earnings gained 3.5% in June on an annualized basis. The Canadian economy is forecast to gain 2% this year, after a strong performance of 3% in 2017. Inflation has improved and is close to the BoC target of 2 percent. However, bank policy-makers remained concerned about escalating trade tensions, which includes a tariff spat between the U.S. and Canada.
Investors remain uneasy about the tariff battle being waged between the U.S. and its major trading partners, particularly China. After the U.S. and China imposed tariffs on each other of some $30 billion, the Trump administration has raised the ante, threatening to hit China with further tariffs on $200 billion worth of Chinese goods. China cannot retaliate in kind, since it does not import that amount of goods from the U.S. Still, the Chinese can take steps which will make it more difficult for U.S. companies to do business in China. The U.S. dollar has benefited from the recent trade battles, and if this trend continues, the Canadian dollar could be facing some substantial headwinds.
Wednesday (July 11)
Thursday (July 12)
*All release times are DST
*Key events are in bold
USD/CAD for Wednesday, July 11, 2018
USD/CAD, July 11 at 7:55 DST
Open: 1.3114 High: 1.3174 Low: 1.3108 Close: 1.3154
USD/CAD has posted small gains in the Asian and European sessions
Further levels in both directions:
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.
Add a Comment
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.