The USD/CAD fell significantly in the wake of reports on Friday showing that the yearly growth of consumer inflation in Canada rose as much as anticipated in July. As the 5 minute chart shows, after the release the Canadian Dollar appreciated against the Greenback by 42 base points to start trading far below the 1.2612 mark until Monday morning.
Statistics Canada reported that its Consumer Price Index gained 1.2% on an annual basis, while being flat month-over-month in July, with both readings matching analysts’ forecasts. The Canadian economic growth is likely to gain momentum in the upcoming quarter, with inflation capable of reaching the Bank of Canada’s 2% target, which would prompt the central bank to deliver one more rate hike this fall.
