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CAD weakens to 6-day low as threat of inflation recedes somewhat

  • CAD drops to nearly 1-week low against USD
  • This followed reports of lower underlying inflation, lower oil prices
  • Canadian stock markets also traded lower on Wednesday

The Canadian dollar fell to virtually a 1-week low against the USD on Wednesday. This came after oil prices dropped and stock markets traded lower as statistics indicated a lower underlying level of inflation.

The country’s yearly inflation rate crept up from 1.9% in March to 2% last month, pushed partly by a carbon levy that impacted on gasoline prices in six provinces. Two of the BoC’s thee measures of core inflation, however, showed a decline.

After the report the probability that the central bank would reduce interest rates before the end of 2019 increased marginally to just over 40%.

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