Inflation Numbers Work into Dollar Trade

Before the release of key Canadian economic fundamentals this morning, the Canadian dollar broke and held below its major support level of the week $1.3605 (.7350). Helping the loonie extend gains was oil; WTI Crude traded above $50.00 U.S. per barrel at 5 am EDT. Support levels for the Canadian dollar are $1.3559 and $1.3513. Statistics Canada released key economic data this morning with CPI and Core CPI Y/Y printing 1.6% and 1.3%, respectively. Retail Sales M/M for March saw sales excluding autos print at -0.2% and the headline figure print at 0.7%. The data is timely as investors head into next week''s Bank of Canada rate announcement, analysts are anticipating the BOC to remain cautious and keep the interest rate unchanged.

It is very quiet on the data front for the U.S. dollar today with no economic fundamentals released. St Louis Federal Reserve President James Bullard spoke this morning at 9:15. The dollar is trading on the broader market sentiment to close off the week and is well mixed against its trading peers. President Trump today leaves on an eight-day trip to the Kingdom of Saudi Arabia, the Vatican, and France to meet the new president. The platform could be just what Trump needs to get away from the domestic tangled web of troubles that have headlined daily. For the greenback, it will be of interest if the President shares his view on the administration dollar policy.

Investors expect a range today of $1.3545 to $1.3610

German Producer Prices in April helped give the euro a little boost with strong results, as month over month printed at 0.4% and year over year printed at 3.4%, which were both better by 0.2% from forecast. Euro-zone Current Account also outperformed, printing at 34.1 billion in March when expectations was for 32.3 billion. Losses from yesterday were essentially erased as the euro has retraced back to higher levels, currently trading at $1.5189.

Traders expect a range today of $1.5135 to $1.5216

No major event risk is expected out of the U.K. today leaving the pound to trade on second-tier data. Confederation of British Industries Trends in May were mixed as Total Orders printed at 9 when expectations were for 4 and Selling Prices fell to 23 from the expected 29. Highlight of next week will be U.K.’s Gross Domestic Product due on Thursday with minor public finances and net borrowing data due Tuesday. The pound is currently trading at $1.7636.

Experts expect a range today of $1.7635 to $1.7727

The Australian dollar is holding steady going into the weekend. Positive employment data released earlier this week, which continues to underpin the Aussie. Furthermore, stronger metal prices also helped to boost the commodity currency. Copper is up 1.05%, while iron ore prices are also stabilizing near their recent lows.

Oil (WTI): $50.06 U.S. per barrel

Gold: $1,253.00 U.S. per ounce

Silver: $16.82 U.S. per ounce

Copper: $2.5589 U.S. per tonne

Dollar Index: 97.36

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