Canadian Dollar Appreciates As Inflation Surges
February 16 2022 - 5:09AM
RTTF2
The Canadian dollar spiked up against its most major rivals in
the New York session on Wednesday, as a data showed that the
nation's annual inflation accelerated to a fresh 30-year high in
January.
Data from Statistics Canada showed that the consumer price index
rose 5.1 percent on a year-over-year basis in January, up from a
4.8 percent gain in December. This was the highest inflation rate
since September 1991. Economists had expected a 4.8 percent
increase.
On a seasonally adjusted monthly basis, the CPI climbed to 0.6
percent from 0.3 percent in December.
Core CPI, excluding food and energy, grew 0.4 percent from 0.3
percent last month.
The loonie firmed to 1.2663 against the greenback, its strongest
level since February 10. The loonie is seen facing resistance
around the 1.25 level.
The loonie edged up to 1.4388 against the euro, from a low of
1.4459 hit at 2:45 am ET. If the loonie rises further, 1.42 is
likely seen as its next resistance level.
The loonie rebounded to 0.9074 against the aussie, after
declining to a 5-day low of 0.9117 in the previous session. The
loonie may challenge resistance around the 0.89 level.
In contrast, the loonie pulled back to 90.94 against the yen,
from a 5-day high of 91.40 it touched immediately following the
data. The next likely support for the currency is seen around the
88.00 level.
Data from the Ministry of Economy, Trade and Industry showed
that Japan's tertiary activity rose at a softer pace in
December.
The tertiary activity index rose 0.4 percent month-on-month in
December, after 0.7 percent increase in November.
Looking ahead, the Fed minutes from the January 25-26 meeting
are set for release at 2:00 pm ET.
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