Market Watch: Will the Canadian Dollar Rebound After Falling Due to Lower Canadian CPI?

Market Watch: Will the Canadian Dollar Rebound After Falling Due to Lower Canadian CPI?

22.05.2024

In the previous day’s U.S. currency trading, the Canadian dollar fell against the yen immediately after the release of Canada’s April Consumer Price Index (CPI), which showed a 0.2-point year-over-year decline to 2.7% from the previous month’s 2.9%. The CAD/JPY pair fell from 114.829 to 114.150.The price fell to just below the 200-period simple moving average (SMA) on the hourly chart. On the 4-hour chart, the price briefly dipped below the 20-period moving average (MA), while on the daily chart, it is finding support at the 10-period MA; therefore, we should watch for any recovery momentum during U.S. trading hours.

European currencies fell against the yen as Germany’s April Producer Price Index (PPI), released yesterday, worsened year-over-year from -2.9% in the previous month to -3.3%.The EUR/JPY pair fell from 169.939 to 169.218, breaking below the 75-period moving average (MA) on the hourly chart. However, the 20-period MA is acting as support on the 4-hour chart, and the daily chart shows rising highs despite some consolidation. Therefore, we will be closely monitoring the pair’s potential for recovery during European trading hours.

Today’s schedule includes Japan’s trade balance at 8:50, the RBNZ policy rate and statement at 11:00, the UK Consumer Price Index, UK Producer Price Index, and UK retail sales at 15:00, South Africa’s Consumer Price Index at 17:00, remarks by ECB President Lagarde at 17:05, the US MBA Mortgage Applications Index at 20:00,21:45 UK: Remarks by BOE Deputy Governor Breeden; 22:40 US: Remarks by Chicago Fed President Goolsbee; 23:00 US: Existing Home Sales; 23:30 US: Weekly Crude Oil Inventories; 26:00 US: 20-Year Treasury Auction; 27:00 US: Release of FOMC Minutes.We want to carefully assess the resilience of the Canadian dollar, which fell following the decline in Canada’s CPI.

Past Market Reports

1. 17.04.2026New

   Will the market wait and see how much further the U.S. dollar can rise against the yen?

2. 16.04.2026New

   Will the weakening Swiss franc recover? Attention is turning to price movements during European trading hours.

3. 15.04.2026New

   Market participants are likely keeping a close eye on the upside potential of the euro, which has risen against the U.S. dollar

4. 14.04.2026New

   Should we keep an eye on remarks by key figures in the U.S. and try to gauge the direction of currency strength?

5. 13.04.2026New

   Market participants are likely watching for signs of a rebound in the Canadian dollar, which fell against the U.S. dollar following the release of employment figures

6. 10.04.2026

   Will the weakening Swiss franc continue to strengthen against the yen, or should we wait and see?

7. 09.04.2026

   Will the U.S. dollar, which has fallen against the yen, continue its downward slide, or should we wait and see how the market moves?

8. 08.04.2026

   Should we keep an eye on the upside for European currencies that have risen against the U.S. dollar?

9. 07.04.2026

   Market participants may be wary of further downside potential for the U.S. dollar, which has weakened amid concerns over the situation in Iran

10. 06.04.2026

    Investors should be wary of sudden spikes in volatility while major markets are closed