FX Action: USD-CAD has settled in the 1.2600s
FX Action: USD-CAD has settled in the 1.2600s after last Thursday clocking a two-month high of 1.2761 yesterday. A trifecta of softer than expected Canadian CPI data on Friday (which slowed to 1.7% y/y from 1.9%), a broader fall back in the U.S. dollar, and firmer tone in oil prices (which have risen to three-week highs), brought the pair back under pressure after rallying from the 1.2450 area over the last week or so. The next Canadian data of note will be January industrial product prices on Wednesday, where analysts expect a 0.5% m/m gain. Q4 current account and December and Q4 GDP data are also due this week, on Thursday and Friday, respectively. The NAFTA renegotiation remains a font of uncertainty for the Canadian economy.