Preview of Canadian CPI due at 12.30 gmt
It's stopped snowing and Adam got sunburnt the other day. Life couldn't be better in the land where syrup flows like water and you have to queue behind moose at the traffic lights
Syrup prices will be in focus somewhere amongst the inflation data released today and Loonie lovers will be looking for clues from it that would have the hand flapper Poloz shifting his view on monetary policy
Year on year inflation is expected to remain unchanged at 0.8%, and rise 0.5% m/m. The ever important BOC core is expected to show a 2 tick drop to 2.1% y/y, and a 2 tick rise to 0.3% m/m
There will be no avoiding the energy prices which helped inflation fall to the lowest since 2013 and outside of the BOC's 1-3% target range. Energy fell 1.1% in April after a 3.2% gain in March
If the headline continues lower that may cause some players to think about whether the BOC might switch to a more dovish stance. The core number will be important before we jump on that train though and Poloz is firmly in the "temporary" camp with regards to lower inflation
The shock may come if we see inflation moving back above 1.0% as that might put some pressure on Poloz's neutral stance, although we'll need to see un upward trend develop
With no US data on the docket we'll need to get our trading fix from this and the retail sales data out at the same time, so it could bring bigger moves than normal
USDCAD has the 55 and 100 dma range to play and the 1.2200 level is still yet to see a close below. 1.2345/50 is the nearer resistance point before a look at the 100 dma
USDCAD daily chart
Just in case I don't post again before clocking off, I wish you all a great weekend and thank you for coming to ForexLive
