The Loonie pair plunged the most since early June the previous day after the US Consumer Price Index (CPI) declined to 8.5% on YoY in July versus 8.7% expected and 9.1% prior. “After Wednesday’s CPI report, traders of futures tied to the Fed’s benchmark interest rate pared bets on a third straight 75-basis-point hike at its Sept. 20-21 policy meeting and now see a half-point increase as the more likely option,” said Reuters following the data.
POTUS Joe Biden also cheered the US CPI miss while saying, “Seeing some signs that inflation may be moderating,” as reported by Reuters. “We could face additional headwinds in the months ahead,” Biden added. “We still have work to do but we’re on track,” adds US President Biden.
Looking forward, the weekly readings of the US Jobless Claims and the monthly Producer Price Index (PPI) for July could entertain investors. Though, major attention should be given to the qualitative factors in the wake of recent risk-negative headlines. Also important will be the monthly oil demand forecasts from the Organization of the Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA).
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