Canada’s CPI grew in January more than expected (2.5% y/y and 0.4% m/m )due to gasoline and foodstuffs.
These data will probably result in no changes concerning the interest rates (the decision will be made on March 3rd 2012). Moreover, Canada’s central bank will most likely have to leave the interest rates unchanged for a prolonged period of time. Some experts are sure that the Bank of Canada won’t take any major steps till the end of 2012.
In the meantime, the Canadian Dollar keeps strengthening against its US counterpart. According to the Department of Masterforex-V Trading System , at this point USDCAD is forming sub-wave 5 or A in the “Hound of the Baskervilles’ pattern by Elder/MF. The closest levels of support are 0.9091, 0.9883, 0.9866.The current downswing will be completed once the price breaks above the MF sloping channel and pivot 1.0050 (as shown below):
