Canadian dollar is struggling today, even though other high beta currencies are doing well. One of the issues right now is the latest CPI data coming out of Canada. Concerns about the Canadian economy are mounting, and that is weighing on the loonie today.
Loonie reached a low not seen for six months against the US dollar earlier today, thanks to the latest CPI report. Canada’s latest inflation report showed a 0.6 per cent decline for the month of December. Analysts had predicted a smaller decline. With inflation lower than expected, concerns are being raised about the Canadian economy.
The Canadian economy has held up quite well throughout the recent global economic crisis and recession, but now there are concerns that the situation might be catching up with the country. There are worries that the housing market is overheating, and the unemployment situation has been lackluster. With this latest CPI data, the picture is starting to emerge of slowing. Many Forex traders will be looking toward the next Bank of Canada rate announcement to see if a cut is made, and to see what the policymakers have to say about the forecast.
At 17:47 GMT USD/CAD is up to 1.0088 from the open at 1.0025. EUR/CAD is up to 1.3578 from the open at 1.3402. GBP/CAD is up to 1.5933 from the open at 1.5818.
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