Canadian Dollar Jumps on CPI, Risk Appetite Lifted by Fed Expectations
Action Insight Mid-Day Report 8-21-19

Canadian Dollar Jumps on CPI, Risk Appetite Lifted by Fed Expectations

Canadian Dollar jumps broadly in early US session after stronger than expected consumer inflation data. Australian Dollar follows as the second strongest, with help from risk appetite since European session. Fed Kashkari's push for forward guidance raises expectation that Fed will keep rates low for longer. Yen and Swiss Franc weaken as a result of the strength in stocks. Yet, Sterling is the weakest one so far on Brexit uncertainty.

Some more volatility could be seen for the rest of the day. FOMC minutes would reveal the debates behind the rate cut last month. We'd probably seen how dovish Fed policy makers were leading to the cut. Though, chair Jerome Powell's speech at Jackson hole on Friday could be more market moving. On other hand, Italian President Sergio Mattarella will begin his two days talks with political parties after the coalition collapsed with Prime Minister Giuseppe Conte's resignation yesterday. A key would be on whether rivals 5-Star Movement and Democratic Party could form a coalition.

Technically, despite the dip in USD/CAD, there is no change in the near term outlook. With 1.3177 minor support intact, further rise is still in favor through 1.3345 at a later stage. USD/CHF recovered ahead of 0.9762 minor support. Focus is back on 0.9821 temporary top and break will resume the rebound from 0.9659.

In US, DOW futures is currently up 190 pts and points to extended rebound. FTSE is up 1.16%. DAX is up 1.27%. CAC is up 1.57%. German 10-year yield is up 0.0201 at -0.668. Earlier in Asia, Nikkei dropped -0.28%. Hong Kong HSI rose 0.15%. China Shanghai SSE rose 0.01%. Singapore Strait Times dropped -0.43%. Japan 10-year JGB yield dropped -0.0052 to -0.24.

Full Report Here

Top Movers | HeatMap | Pivot Points | Pivot Meters | Action Bias | Vol

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Central Bank Views | China Watch | Oil N' Gold | Special Topics

USD/CAD Mid-Day Outlook

Daily Pivots: (S1) 1.3304; (P) 1.3325; (R1) 1.3341; More...

USD/CAD is still staying in consolidation from 1.3345 and intraday bias remains neutral. Despite today's dip, further rise is still expected with 1.3177 support intact. On the upside, break of 1.3345 will extend the rebound from 1.3016 to 1.3564/3664 resistance zone. On the downside, however, break of 1.3177 support will turn bias back to the downside for retesting 1.3016 low instead.

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EURUSD | USDJPY | GBPUSD | USDCHF | AUDUSD | USDCAD

EURJPY | EURGBP | EURCHF | EURAUD | GBPJPY

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Economic Calendar
GMT Ccy Events Actual Forecast Previous Revised
00:30 AUD Westpac Leading Index M/M Jul 0.10% -0.08%
08:30 GBP Public Sector Net Borrowing (GBP) Jul -2.0B -3.7B 6.5B 5.7B
12:30 CAD CPI M/M Jul 0.50% 0.20% -0.20%
12:30 CAD CPI Y/Y Jul 2.00% 1.70% 2.00%
12:30 CAD CPI Core - Common Y/Y Jul 1.90% 1.80% 1.80%
12:30 CAD CPI Core - Median Y/Y Jul 2.10% 2.10% 2.20%
12:30 CAD CPI Core - Trim Y/Y Jul 2.10% 2.00% 2.10%
14:00 USD Existing Home Sales Jul 5.41M 5.27M
14:30 USD Crude Oil Inventories -1.4M 1.6M
18:00 USD FOMC Meeting Minutes
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