Key Canada inflation data, dollar rally continues

18 December,, Lagos – The week is now likely to end on a quiet note as we have a scanty economic calendar for the rest of the day, with the key Canada inflation data being the only high impact news on the calendar.

Meanwhile, the dollar is strengthening across board in the aftermath of the US central bank’s decision to commence rate hikes. The Japanese Yen has, however, been the star performer today so far, confirming Goldman Sachs on USDJPY. The Yen increased performing comes due to the Bank of Japan’s (BOJ) decision this morning to maintain its base money target while expanding the range of assets it purchases. Therefore, sending the Yen rallying across board.

UK Retail Sales m/m

Retail sales measures the change in the total value of inflation-adjusted sales at the retail level, also it serves as a gauge of consumer spending. Data released yesterday  from the UK showed year-on-year estimates of the quantity bought in the retail industry show growth for the 31st consecutive month in November 2015, increasing by 5.0% compared with last year. The month on month change came in at 1.7%, one of the best reading for the year. The GBPUSD pair continued downwards as pointed out in yesterday’s morning fundamental analysis.

BOJ monetary policy statement

The Bank of Japan decided to hold its base money target under its massive stimulus program. However, they have expanded the range of assets it purchases, a move intended to spur firms to spend more on wages and investment. The central bank held its policy target of increasing cash and deposits in circulation at an annual rate of 80 trillion yen ($655 billion) via aggressive buying of government bonds, exchange-traded funds (ETFs) and trust funds investing in property. Additionally, the BOJ decided to set aside 300 billion yen to buy ETFs that specifically target shares of companies actively pursuing capital expenditure. Following the announcement, the yen has been strengthening across board.

Canada inflation data

The key Canada inflation data, CPI and Core CPI m/m are forecasted to come in at 0.1% and 0.0% respectively, as a measure of the current state of the country. The economy still remains subdued as oil prices trade around year lows. The USDCAD is currently trading around and 11 year high, with no signs of easing.

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