CAD CPI Up Next
Thelatest set of Canadian CPI data due today is attracting plenty of marketattention. On the back of the recent bumper inflation numbers we’ve seen out ofthe US, last week, and the UK, this week, focus is now shifting to Canada. Withthe BOC having recently hiked rates by a full percentage point, the largestincrease from the BOC since the 70’s, incoming inflation data will be key fortraders seeking to determine how the BOC is likely to proceed at the nextmeeting.
The BOCsignalled that further hikes will likely be necessary but did say that future moveswill be data dependant, this means there are clear two-way risks into today’sdata. A strong reading will keep the focus on hawkish BOC expectations, keepingCAD supported. A weak reading will no doubt soften BOC rate-hike expectations leadingto some CAD give-back.
Where toTrade CAD CPI?
CADJPY
Therecent CADJPY long idea has now triggered with price moving above the 107.19level. If CAD CPI comes in hot today, we can expect the pair to receiveimmediate support towards the initial 109.70 target. With the BOC firmly committedto tightening and the BOJ set to reaffirm its commitment to easing this week, themonetary policy divergence between the two central banks favours further upsidein CADJPY.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.