EUR/CAD depreciates to near 1.5100 after EMU HICP data, Canada’s inflation eyed

Source Fxstreet
  • EUR/CAD loses ground following key economic data from the European Monetary Union.
  • EMU HICP MoM showed no change in July, while Core inflation declined by 0.2%.
  • The commodity-linked CAD rises despite a losing streak in WTI prices.

EUR/CAD retraces its recent gains from the previous two days following the key data on business activity and consumer prices from the European Union. The pair trades around 1.5100 during the European session on Tuesday.

The Harmonized Index of Consumer Prices (HICP) data from the European Monetary Union (EMU) showed no change month-on-month in July, as expected. Meanwhile, Core HICP declined by 0.2%, consistent with the decrease observed in June.

Germany’s Producer Price Index (PPI) declined by 0.8% year-over-year in July, in line with expectations, following the previous decline of 1.6%. Meanwhile, the monthly index showed a 0.2% increase, also as anticipated.

Investors anticipate that the European Central Bank (ECB) will gradually reduce interest rates. ECB policymakers have hesitated to commit to a specific rate-cut path due to concerns that price pressures could reaccelerate.

The commodity-linked Canadian Dollar (CAD) outperforms despite the continuation of a bearish streak in crude Oil prices and undermines the EUR/CAD cross. West Texas Intermediate (WTI) Oil price continues its losing streak for the third successive day, trading around $72.90 per barrel at the time of writing. This downside is attributed to the de-escalation of the geopolitical tensions in the Middle East.

On Monday, US Secretary of State Antony Blinken announced that Israel had agreed to a proposal to resolve the issues delaying a Gaza ceasefire and urged Hamas to follow suit. However, Hamas senior official Osama Hamdan criticized Blinken's statement that Israeli Prime Minister Benjamin Netanyahu had accepted an updated proposal. Hamdan claimed it "raises many ambiguities" and is "not what was presented to us nor what we agreed on," per Reuters.

Traders are likely to focus on the risks of slower economic growth in Canada and position themselves ahead of the Consumer Price Index (CPI) data release by Statistics Canada, scheduled for later in the North American session. This inflation report is expected to indicate further easing of inflation in July, which could potentially allow the Bank of Canada (BoC) to continue its monetary loosening cycle.

Economic Indicator

Harmonized Index of Consumer Prices (MoM)

The Harmonized Index of Consumer Prices (HICP) measures changes in the prices of a representative basket of goods and services in the European Monetary Union. The HICP, released by Eurostat on a monthly basis, is harmonized because the same methodology is used across all member states and their contribution is weighted. The MoM figure compares the prices of goods in the reference month to the previous month. Generally, a high reading is seen as bullish for the Euro (EUR), while a low reading is seen as bearish.

Read more.

Last release: Tue Aug 20, 2024 09:00

Frequency: Monthly

Actual: 0%

Consensus: 0%

Previous: 0%

Source: Eurostat

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Trump Withdrawal Intent Reshapes Liquidity, Bitcoin Breaks $68,000 MarkUS and Iran signal ceasefire talks; Bitcoin breaks $68,000, expected to continue rebounding in the short term.On April 1, Bitcoin ( BTC) prices continued to rebound, strengthening further
Author  TradingKey
6 hours ago
US and Iran signal ceasefire talks; Bitcoin breaks $68,000, expected to continue rebounding in the short term.On April 1, Bitcoin ( BTC) prices continued to rebound, strengthening further
placeholder
Today’s Market Recap: US and Iran Signal Willingness to End Conflict, Three Major US Stock Indexes Surge, Dollar Ends Five-Day Winning StreakAs the U.S. and Iran signaled a de-escalation of their conflict, market risk appetite recovered significantly, with the three major U.S. stock indices rebounding sharply to record their l
Author  TradingKey
15 hours ago
As the U.S. and Iran signaled a de-escalation of their conflict, market risk appetite recovered significantly, with the three major U.S. stock indices rebounding sharply to record their l
placeholder
Brent: Forecast lifted with $150 risk – Societe GeneraleSociete Generale’s commodities team has revised its Oil outlook, warning Brent could spike towards $150/bbl in a higher‑for‑longer scenario if the Strait of Hormuz is shut for two months.
Author  FXStreet
Mar 31, Tue
Societe Generale’s commodities team has revised its Oil outlook, warning Brent could spike towards $150/bbl in a higher‑for‑longer scenario if the Strait of Hormuz is shut for two months.
placeholder
Australian Dollar advances as RBA Minutes flag more tighteningAUD/USD halts its five-day losing streak, trading around 0.6860 during the Asian hours on Tuesday. The pair advances as the Australian Dollar (AUD) receives support after the Reserve Bank of Australia released its March Meeting Minutes.
Author  FXStreet
Mar 31, Tue
AUD/USD halts its five-day losing streak, trading around 0.6860 during the Asian hours on Tuesday. The pair advances as the Australian Dollar (AUD) receives support after the Reserve Bank of Australia released its March Meeting Minutes.
placeholder
USD/JPY Hits 160.00 Mark, Will Japanese Government Intervene? Will the Currency’s Rally Be Contained?As of March 30, the US Dollar against the Japanese Yen ( USDJPY) continues to fluctuate at high levels near the 160 mark, with the Yen having fallen to a nearly one-year low. Expectations
Author  TradingKey
Mar 30, Mon
As of March 30, the US Dollar against the Japanese Yen ( USDJPY) continues to fluctuate at high levels near the 160 mark, with the Yen having fallen to a nearly one-year low. Expectations
Related Instrument
goTop
quote