Ahead of today’s Canadian inflation figures, the ‘Loonie’ edged away from yesterday’s three-month high against the US Dollar as higher-risk assets shed gains considered ‘excessive’ by investors.
The Canadian Dollar Exchange Rate was in the region of 0.6075 against the British Pound as of 14:30 GMT
The commodity-driven currency also softened against the Pound as the UK’s budget deficit narrowed and gave the Pound a modest boost.
While the Fed may have opted to refrain from tapering stimulus this month, investors are now betting that a reduction will be made in December.
According to currency strategist Greg Moore, ‘The Fed move does shift things and it will change our outlook for the Canadian Dollar a little bit higher longer-term – it will basically push out our forecast for a lower Canadian Dollar. But I think the severity of the move may not be much more than we’ve already seen.’
However, the ‘Loonie’ did extend declines after Canada’s inflation rate slowed.
The consumer price index increased 1.1 per cent last month from a year earlier, down from July’s gain of 1.3 per cent and in line with economists’ expectations.
This is the first time the rate has slowed for four months.
The CAD/GBP exchange rate hit a low of 0.6042
Toronto-based economist Derek Holt had this to say of the result; ‘I don’t see the case to be really worried about inflation and that backs a dovish Bank of Canada doe a long time’.
The core consumer price index came in at 1.3 per cent, down from an increase of 1.4 per cent in July.
Next week’s most influential Canadian data includes Tuesday’s retail sales figures and Thursday’s average weekly earnings report.
Of course, news from the US will also be of interest while UK GDP data (due out on Thursday) could also inspire movement in the CAD/GBP pairing.
Current Canadian Dollar (CAD) Exchange Rates:
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The Canadian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9720 <
The Canadian Dollar /Euro Exchange Rate is currently in the region of: 0.7187 <
The Canadian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6075 <
The Canadian Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0328 >
The Canadian Dollar /New Zealand Dollar Exchange Rate is currently in the region of: 1.1678 <
The Pound Sterling/Canadian Dollar Exchange Rate is currently in the region of: 1.6468 >
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0288 >
The Euro/Canadian Dollar Exchange Rate is currently in the region of: 1.3913 >
The New Zealand Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.8567 >
The Australian Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.9685 <
(Correct as of 14:30 GMT)
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