Sticky CPI limits BoC cuts, supports CAD – BBH

USD/CAD is trading around the middle of multi-week 1.3550-1.3800 range, BBH FX analysts report.

USD/CAD steady as Canada Inflation holds

"Canada June CPI was largely in line with consensus and argues against additional Bank of Canada rate cuts. Headline CPI printed 1.9% y/y vs. 1.7% in May while core CPI (average of trim and median CPI) remained sticky at 3% y/y for a third consecutive month."

"The BOC is near the end of its easing cycle, which is supportive of CAD. The swaps curve adjusted higher to imply less than 10% odds of a 25bps cut at the next July 30 meeting and 60% odds (vs. fully priced ahead of the CPI data) of a final 25bps cut in the next 12 months."