– Canada’s February inflation rate expected to rise.
– US data and Trump/Putin call in focus
– USD dollar trading negatively due to weak economic data recently.
USDCAD: open 1.4286, overnight range 1.4272-1.4308, close 1.4288, WTI 68.38, Gold 3020.52
The Canadian dollar ais consolidating yesterdays gains after US retail Sales data was weaker than expected. The results suggest that the Trump’s tariff threats are taking a toll on consumers who are fearing higher prices and job losses.
Canadian dollar traders are awaiting the February inflation data even though the results are skewed by the temporary GST/HST inflation cut which expired on February 15. The consensus forecast is for a rise of 0.6% m/m and 2.1% y/y although many economists are predicting even higher numbers.
President Trump tweeted out a threat to Iran. That threat helped lift gold prices (XAUUSD) to 3029.69 in early NY from 2982.64 yesterday. It also helped WTI oil rise to 68.49 from 67.09 on the threat of supply disruption from the Middle East.
EURUSD traded in a 1.0904-1.0955 range, ahead of what trader’s hope is a favorable outcome in German governments €500 billion defence and infrastructure spending bill. Additional support came from the German ZEW Economic Sentiment index, which jumped 25.6 points to 51.6 in March, fueled by optimism surrounding stimulus measures.
GBPUSD climbed from 1.2968 to 1.3005, maintaining upward momentum on widespread US dollar selling pressures and from speculation that the Bank of England will keep interest rates steady at its upcoming policy meeting on Thursday.
USDJPY traded higher in a 149.13-149.90 range, after yesterdays weaker-than-expected US retail sales data raised expectations that the Federal Reserve may cut rates sooner than previously anticipated. Traders are now focused on the Bank of Japan’s policy meeting tomorrow, where officials are widely expected to leave interest rates unchanged amid ongoing global trade tensions.
AUDUSD traded in a 0.6367-0.6391 range, supported by an uptick in risk sentiment. Improved market optimism stems from China’s latest initiatives aimed at bolstering domestic economic growth, along with renewed speculation about a possible ceasefire in Ukraine.
Today’s US data includes: building permits, import and export price indexes, housing starts, capacity utilization, industrial production, and business inventories.
