CAD trades weaker on BoC preferred inflation

The annual inflation rate in Canada accelerated slightly in April on broad-based price increases for items such as mortgage payments, vehicles and fresh vegetables.

According to StatsCanada, Canada’s rose 2.0% y/y, after a 1.9% advance in March.

On a month-over-month basis, inflation climbed 0.4%, led by higher prices for gasoline and women’s clothing.

However, the Bank of Canada preferred measures for underlying inflation moved down. The average annual gain for the three core-inflation measures came in at 1.9% m/m vs. March’s 2%.

CAD is trading at the low of the day so far, the USD is up 0.2% at C$1.3490.

USD/CAD for May 14-16, 2019.

U.S. retail sales miss

South of the Canadian border, an important measure of consumer spending fell in April, signalling spending was sluggish stateside as Q2 begins.

Retail sales declined a seasonally adjusted 0.2% in April m/m according to the Commerce Department.

The drop fell short of the 0.2% increase the market was expecting. The disappointing print has dealers increasing the odds for a Fed rate cut sooner than later.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.