CAD Inflation Surges to 2.9%: Impact on Currency Trading

Yesterday, we saw the Canadian Consumer Price Index (CPI) for May. It went up by 2.9% from last year. This was more than the expected 2.6% and last month’s 2.7%. At first, the GBP/CAD saw a little bit of volatility but has since levelled out.

Today: GfK Consumer Confidence in Germany for July is -21.8, down from June’s -21.0. People were thinking it would be -18.9, but it turned out to be -20.3. This fall means German people are feeling more negative, maybe because they are worried about money or prices going up.

In the US, the Fed will show the yearly bank stress test results soon. These tests check big US banks’ strength in different tough economic situations. A good result can help the USD, while a bad one might hurt it.

Tomorrow, Out from the states, we have the May Durable Goods Orders and the final Q1 GDP Growth Rate. Orders for Durable Goods may show a small increase, with most people thinking it will be 0%. The forecast says it may be 0.1%. This shows that making things may not be growing a lot. The GDP growth rate is thought to show a big slowdown to 1.3%. Before, it was a strong 3.4%.

Currency Trading Update – June 26th, 2024

Today’s currency markets are busy with trade. Economic data and global politics are steering the action. Let’s look at the important moves and changes in the currency market.

Key FX Movements:

EUR/USD: The Euro (EUR) has shown relative stability against the USD, trading around 1.0870. Market participants are keenly observing the upcoming Eurozone consumer confidence data, which is expected to provide insights into the region’s economic outlook. The European Central Bank’s cautious stance continues to influence the pair’s movement, as investors await further policy cues (TradingView, FXStreet).

GBP/USD: The British Pound (GBP) has experienced modest gains, trading at 1.2730 against the USD. This movement comes amid anticipation of the UK’s latest GDP figures, which are crucial for assessing the country’s economic health. Additionally, political developments and Brexit-related news continue to play a significant role in influencing GBP movements (TradingView, Bloomberg).

USD/JPY: The Japanese Yen (JPY) remains under pressure, with the pair trading at 143.50. The Bank of Japan’s (BoJ) dovish monetary policy and Japan’s expanding trade deficit are key factors contributing to the Yen’s weakness. Traders are also focused on the upcoming industrial production data from Japan for further market direction (TradingView, CMC Markets).

AUD/USD: The Australian Dollar (AUD) is trading around 0.6780, slightly buoyed by improved commodity prices. However, concerns about China’s economic slowdown, which significantly impacts Australia’s export-driven economy, continue to weigh on the AUD. The Reserve Bank of Australia’s (RBA) recent minutes release will be closely watched for any policy insights (TradingView).

Other Economic News:

U.S. Durable Goods Orders: The latest U.S. durable goods orders data shows a moderate increase, reflecting positive business investment levels. This data is pivotal as it impacts the overall economic outlook and indicates business sentiment and future manufacturing activity (TradingView).

Eurozone Consumer Confidence: The Eurozone consumer confidence data, expected to show a slight improvement, is critical in assessing the region’s economic recovery amidst inflation concerns. Positive consumer confidence could signal a more robust economic outlook for the Eurozone (TradingView).

Japan Industrial Production: Japan’s industrial production data, expected to show a slight uptick, will be essential in evaluating the health of the country’s manufacturing sector, especially given the global supply chain disruptions and domestic economic challenges (TradingView).

Global Oil Prices: Oil prices are experiencing minor fluctuations, with Brent crude hovering around $71 per barrel. Market analysts are closely watching OPEC+ for any indications of production adjustments. Geopolitical tensions and supply chain issues continue to play a significant role in the energy market’s dynamics (Bloomberg).

The USD maintains its strength, while other major currencies are influenced by region-specific factors. As the week progresses, traders will closely monitor durable goods orders, consumer confidence indices, and industrial production data to gauge the future direction of currency movements. Stay tuned for further updates as the economic landscape evolves.