Forex

USD/CAD remains below 1.3300 handle on softer US CPI, tumbling Oil prices lend support

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Softer US consumer inflation figures do little to inspire the USD bulls. A slump in Oil prices seemed to be the only factor lending some support.

The USD/CAD pair held on to its mildly positive tone through the early North-American session, albeit continued with its struggle to make it through the 1.3300 handle post-US CPI.

The ongoing slump in Crude Oil prices, now down nearly 3.0% for the day and sliding below the $52.00/barrel mark, weighed on the commodity-linked currency – Loonie and turned out to be one of the key factors lending some support to the major.

The uptick, however, lacked any strong bullish conviction on the back of a subdued US Dollar price action as market participants seemed convinced that the Fed will need to cut rates sooner rather than later amid a series of weak domestic macro data. 

The latest disappointment came from the US consumer inflation figures, showing that the headline CPI eased more than expected to 1.8% yearly rate in May and core CPI also ticked lower to 2.0% from 2.1% recorded in the previous month.

The data reinforced market expectations and continued exerting some downward pressure on the greenback, which might continue to keep a lid on any meaningful up-move, at least for the time being.

Technical levels to watch

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