The post USD/CAD weakens below 1.3650, eyes on FOMC Minutes appeared on BitcoinEthereumNews.com.

USD/CAD drifts lower to 1.3640 in Wednesday’s early European session.  The annual Canadian CPI inflation rate slowed to 2.7% in April from 2.9% prior, boosting the odds of the BoC June rate cut. The Fed remains cautious and will wait for more encouraging data to ensure inflation is on course towards its target. The USD/CAD pair weakens to 1.3640 amid the US Dollar (USD) consolidation on Wednesday during the early European session. The pair edges lower despite the recent softer Canadian CPI inflation data, which boosts the bets of a rate cut from the Bank of Canada (BoC) in June. Investors await the FOMC Minutes and the Federal Reserve’s (Fed) Goolsbee speech later in the day.  Inflation in Canada cooled to 2.7% in April as food price growth slowed, Statistics Canada reported on Tuesday. The Canadian Consumer Price Index (CPI) inflation dropped to 2.7% YoY in April from 2.9% in March, in line with the market estimation. On a monthly basis, headline CPI inflation eased to 0.5% MoM in April from 0.6% in the previous reading. Additionally, the BoC’s core CPI rose 1.6% YoY in April, compared to a 2% increase recorded in March. The easing inflation data has prompted speculation that the BoC will start cutting rates in the June meeting. Traders increased their bets for a rate cut on June 5 to nearly 55% from 39% before the data was released. The pace of interest rate cuts from the BoC and US Fed might exert some selling pressure on the Canadian Dollar (CAD) and act as a tailwind for USD/CAD.  The Fed officials prefer to wait for more encouraging data to gain confidence that inflation is on course towards the Fed’s 2% target. Atlanta Fed President Raphael Bostic said that the Fed has to be cautious about the first-rate move to ensure that inflation…

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Filed under: News - @ May 22, 2024 8:18 am