The Canadian dollar weakened to the USD in a sales session done in the Tuesday sales. The cause is a declining commodity price. The Canadian inflation data is increasing as well.
However, the speed is still lower than the United States inflation. When this news written, the USD / CAD increased by 0.46 percent to the level of 1.2118. It may changes again.
In fact, the commodity price is not so good today and the stocks in Wall street is weakened as well. It is because the investors are concerning about the American customer inflation increase.
That situation may push The Fed for tightening the monetary policy and reduce the stimulus faster than the prediction. Here are some other progresses in the market lately.
Oil Commodity in Canada Declined
Oil is one of the best export commodities in Canada. That sector declined by 4% to the level of $62 per barrel. The increasing coronavirus cases in Asia makes everything is worse than before.
Another commodity is also weakening. The example is copper where it was down up to 3.3%. The Centeal Bank of Canada gives a special attention to the commodity price condition lately.
They thought that the strengthening Canadian dollar lately is becoming an obstacle that makes the export sector is more difficult. However, there are some factors which help them.
Those are the high demand and the increasing customer purchase which are able to reduce the bad effect of the Lonnie strengthening to the Canadian export. It can solve the problem a little.
The Canadian Inflation Rise is Not as High as in The US
Tonight, the Canadian statistics institution released the Customer Price Index or the CPI data for the April period. It increased by 0.5% in a monthly basic. That is similar with the achievement before.
However, that growth number is higher than the expectation of 0.2%. In a yearly basic, the jump of Canadian inflation case is stronger. That data was increasing from 2.2% to become 3.4%.
That is the highest level since May 2011. However, The analysts are not impressed by the increasing Canadian inflation this time. It is because everything is still inline with the market expectation.
However, the current American inflation is still higher, so that it is predicted that BOC will not give too many reactions due to that data. Mean while, the Australia Statistic Institution also released a data.
That was a data about the customer sentiment which is declining from 118.8 to become 113.1 in May. That happened after it reached the highest level in 10 years achieved on a month before.
The Customers Sentiment Data in Australia
Based on the data, the Australian customers sentiment is 4.8 because publics are quite dissapointed because of the uncertain economic condition in the middle of the massive stimulus.
That stimulus was given by the Central Bank of Australia. According to Westpac, the costumers sentiment are fading after the overrated expectation to the economy recovery prospect.
It is especially from the pandemic effect. An institution did a survey about that stated that the decline can be seen in almost all the sub-index. The sentiment for the financial condition is slipped too.
It is slipped from 103.5 to become 97.9. The same thing happened on the financial sub-indext condition for the 12 months ahead. It is weakened by 117.6 and reached the level of 109.5.
AUD / USD Still Maintains the Rally
The Australian customers sentiment data release some days ago are not giving too many pressure to the AUD vs USD. The AUD / USD pair nowadays is sold around the level of 0.7792.
It is increasing by 0.01 present from the daily open. Generally, the Australian dollar is still helped by the USD weakening which has been experiencing the selling pressure in some days.
However, the analysts said that the selling action to the US dollar begins to decrease. It is because the investors attentions are now in the British and Europe inflation data release that will be done.
