North American Summary and Highlights 21 May
Overview - The highlight of a generally quiet day was a weaker CAD after softer Canadian CPI data.
North American session
The most significant market move came in USD/CAD, which bounced to 1.3675 from 1.3620 on a softer Canadian CPI before settling near 1.3650. Yr/yr growth fell to 2.7% from 2.9% while progress lower in the BoC’s core rates raised hopes for a June BoC easing.
Elsewhere there was little net movement. The USD briefly spiked with front end yields on comments by Fed’s Waller who said several more months of good inflation were needed to cut rates, though the details of the remarks were more balanced and the move quickly faded. USD/JPY later saw a brief move below 156 but this was not sustained.
European morning session
The USD edged a little lower in a quiet European morning. EUR/USD gained around 15 pips to trade above 1.0870, and USD/JPY fell 35 pips to 156.10. AUD/USD recovered losses seen in Asia to trade back at 0.6670. Scandis were slightly firmer, but there was little news of any note.
European data was limited to German PPI, which showed a marginally smaller than expected 0.2% rise in April, and trade and current account data, which showed larger than expected surpluses of EUR24.1bn and EUR35.8bn respectively in March.