USD/CAD flirts with 1.2700 on downbeat CPI

The pair extends the upside to the boundaries of the 1.27 handle.
CAD depreciates further in the wake of March’s inflation figures.
Canadian CPI rose less than expected last month.

Pablo Piovano FXStreet

The Canadian Dollar remains on the defensive so far today, pushing USD/CAD to fresh daily peaks in levels just below 1.2700 the figure.

USD/CAD higher on CPI data

CAD gained extra downside pressure after inflation figures in the Canadian economy surprised to the downside in March, pushing spot to the 1.2700 neighbourhood, or multi-day tops.

In fact, Canadian consumer prices rose at an annualized 2.3% and 0.3% inter-month. Additionally, Core prices rose 0.2% MoM and 1.4% over the last twelve months, all prints coming in below initial estimates.

Still in Canada, Retail Sales gained 0.4% MoM in February, surpassing prior surveys, while Core sales came in flat (vs. a 0.3% expansion forecasted).

In the meantime, spot is up for the third straight session so far today, as the selling bias remains intact following the dovish hold by the Bank of Canada earlier in the week coupled with today’s disappointing releases.

USD/CAD significant levels

As of writing the index is gaining 0.18% at 1.2694 and a breakout of 1.2700 (high Apr.20) would aim for 1.2710 (high Apr.10) and finally 1.2722 (38.2% Fibo of the 2017 drop). On the other hand, initial contention emerges at 1.2622 (200-day sma) followed by 1.2616 (10-day sma) and then 1.2525 (low Apr.17).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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