The Canadian dollar rose for a second day ahead of Canada's key inflation data
LONDON (Reuters) - The Canadian dollar rose on Wednesday against a basket of global currencies, extending for a second straight day against its US counterpart, ahead of key data from Canada on March's key inflation levels, providing fresh evidence of Canadian interest rate hikes During this year.
By 11:59 GMT, the pair was trading around $ 1.3335 from the opening price of $ 1.3349 after recording a high of $ 1.3372 and a low of $ 1.3308.
The Canadian dollar ended yesterday's trading up by more than 0.1% against the US dollar, the second gain in the past three days, supported by high oil prices in the global market.
The dollar index fell by 0.25% on Wednesday, reflecting a decline in the US currency against a basket of major and minor currencies, as demand for the US currency fell as the best alternative investment.
The Reserve Bank of Canada kept steady interest rates unchanged at 1.75% at the March 6 meeting in line with most expectations and reduced its conviction that interest rates will need to rise in 2019 due to the recent slowdown in the country's economy and rising global risks.
The central bank has abandoned its previous assertions that interest rates will need to rise over time, turning to talk that the economy needs stimulus, and that there is more uncertainty about the timing of future rate increases.
Investors have therefore lowered the possibility that the Canadian central bank will raise interest rates this year. To re-evaluate these prospects, investors will be looking for important data from Canada on key inflation levels in the country last month.
By 12:30 GMT, the consumer price index is expected to rise by 0.7% in March with the same reading, and the expected annual reading of 1.9% from a 1.5% rise in February.
The Canadian trade balance is also released at the same time, with a forecast of a deficit of 3.5 billion dollars in February from a deficit of 4.2 billion dollars in January.