USD/CAD - Inflation Misses Mark

Canadian retail sales excluding autos decreased to 0.2% while core increased to 0.4% from expectations of 0.1%. Consumer Price Index data also released Friday morning with the headline number missing the consensus of 1.5%, the core figure showing inflation is only at 1.4% year over year. The importance of these economic fundamentals to investors is that the Bank of Canada has said it will be monitoring key economic data to move on raising interest rates further. Supporting the Canadian dollar this week has been oil, as WTI traded this week as high as $51.11 U.S. per barrel and remained above $50 U.S. heading into the North American open.

U.S. economic data is light this morning with Manufacturing Purchasing Managers Index and Markit Service PMI were to come Friday morning. With the Federal Reserve hinting that interest rates will be on the rise at a "gradual pace" earlier this week, investors will be listening to speeches from Federal Open Market Committee members over the coming weeks. Today's Fed speakers are Esther George and Robert Kaplan at 9:30 a.m. and 1:30 p.m. ET respectively.

Experts expect a range today of $1.2252 to $1.2368

Today is a flawless day for Europe, as all fundamentals that released were better than expected. Manufacturing, Services, and Composite PMI data in September for France, Germany and the euro-zone exceeded expectations. French Gross Domestic Product in the second quarter also came out positive and printed at 0.5% q/q and 1.8% y/y. These are some of the signs of a stronger economy and do support expectations for European Central Bank to taper soon. ECB President Mario Draghi spoke in Dublin today, and the main focus was reducing youth unemployment in the European Union. The euro is currently trading at $1.4723.

Observers expect a range today of $1.4677 to $1.4768

The highlight of the day in Britain will be Prime Minister Theresa May’s speech about "Brexit reboot," which she said will shed more light on her vision of the U.K.'s relationship with the EU. The pound is currently trading at $1.6712.

Traders expect a range today of $1.6661 to $1.6757

The Australian dollar is finding some support after hitting a new low on Thursday. The downgrade of China’s credit rating by Standard and Poors is the main factors of yesterday’s sell-off. However, any meaningful upside today is expected to be capped as weak copper and iron ore prices should keep the Aussie on a more cautious tone.

Oil (WTI): $50.48 U.S. per barrel

Gold: $1,294.59 U.S. per ounce

Silver: $16.93 U.S. per ounce

Copper: $2.9245 U.S. per tonne

Dollar Index: 91.95

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