Canadian dollar is heading higher against its major counterparts today, following the latest inflation report. Even though there are some concerns about the most recent retail sales data, and it doesn’t appear that rates will rise anytime soon, the latest data indicates that things are likely to remain steady, and the loonie is gaining as a result.
Last week, Statistics Canada reported lower than expected retail sales for December, and that sent the loonie lower against many of its counterparts. Today, though, those losses have been mostly offset as the Canadian dollar gains ground. The latest inflation news showed an acceleration of 1.5 per cent year over year in January, which was better than the expected 1.3 per cent increase.
This news of an economic pickup is bolstering the idea that the Bank of Canada won’t need to cut interest rates further just yet. Even though inflation remains below the 2 per cent target, there are hopes that the BOC will simply stay the course. These expectations, along with a surge in US stocks and an increase in oil prices, are helping the loonie today against its major counterparts.
At 15:49 GMT USD/CAD is down to 1.1073 from the open at 1.1104. EUR/CAD is down to 1.5193 from the open at 1.5250. GBP/CAD is down to 1.8402 from the open at 1.8457.
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