CAD Closes Weaker on Slowing Inflation
The Canadian closed lower against its US peer, following three days of gains, and also weakened versus the euro today after Statistics Canada reported that monthly inflation fell unexpectedly last month. The news triggered sell-off of the Canadian currency.
Canada’s Consumer Price Index declined 0.1 percent in July from June on a seasonally adjusted basis, following the 0.2 percent drop in June. That was the third consecutive monthly decline. Forecasters promised an increase by 0.2 percent.
Market analysts thought that the reaction of traders to the data was a bit too strong. The general market sentiment was positive, boosting commodities, and that should have been supportive for the Canadian currency. Additionally, the loonie will likely be supported by good fundamentals in the United States, the major trading partner of Canada.
USD/CAD rose from 0.9864 to close at 0.9892 and EUR/CAD was up from 1.2186 to 1.2199. CAD/JPY closed flat at 80.40.
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Earlier News About the Canadian Dollar:
- Stocks Drop, Loonie Follows (2012-08-14)
- Employment in Canada Worsens, Canadian Dollar Fluctuates (2012-08-10)
- Loonie Gets Boost from Carney's Comments (2012-08-09)
- Loonie Supported by Domestic Fundamentals & Traders' Optimism (2012-08-08)
- Loonie Profits from Optimism Caused by US Payrolls (2012-08-03)