Week in FX Americas – Go On: Lean On The Loonie

Finally, someone is looking to 'lean on the loonie'. This currency is only now trying to play catch up with its antipodean foes -the Aussie and the Kiwi. Both of those currencies of late have found fault with their largest trading partner, China, and with their own strong correlation relationship with commodity prices. The currency pairs have lost -10% in the past month alone. Mind you, the respective central banks rhetoric has also been allowed to lend a directional helping hand.

In Canada, Friday's domestic story was the weaker than expected inflation (+0.2%) and retail sales reports (-0.3%). With the lack of other fundamental data published Stateside, softer numbers have managed to lead the CAD astray, just shy of 1.05. Not helping the loonies' plight is the recent "spat of market volatility and sentiment" that has been driven by the Fed's transparent thoughts and copy this week.

Soft inflation (+1.1% vs. an expected +1.2%) is not just a Canadian issue; it's a...