The Canadian dollar remains at a consistent exchange rate of 0.76 against the US dollar after the final presidential debate.
Statistics Canada said “the Consumer Price Index (CPI) rose 0.5 on a year-over-year basis in September” up 0.1% since August. This doesn’t include gasoline where “the CPI rose 1.0% in September, following a 0.6% increase in August.
Stimulation in the Canadian CPI “was largely due to price changes in transportation, recreation, education and reading, and shelter components” but regardless the Bank of Canada’s still anticipating a 2% inflation rate.
Based on the second wave of COVID hitting major Canadian cities, the index is expected to have weak performance in the months to come due to the recent increase in quarantine measures.
1 CAD is trading at a rate of 1.07 against AUD at the end of this week.
With low-interest rates, the Australian dollar “takes on tones of a descending triangle, with horizontal support holding amidst a series of lower-highs. That setup has filled in and prices have broken down to a fresh low.”
The two currencies are currently moving towards a support zone between .9120 and .9200. The Relative Strength Index (RSI) “has also moved into oversold territory, indicating that prices may be ready to bounce back” as buyers are looking to move back to a horizontal resistance nearing .9400.
Since the beginning of September both CAD and AUD have been decreasing in the falling wedge pattern and it’s expected to face a continued downward trend moving into November; a breakout north is possible if inflation rates stabilize.
By Surina Nath