Canadian Dollar Edges Higher ahead of Building Permits

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The Canadian dollar has edged higher in Wednesday session. Currently, USD/CAD is trading at 1.2966, up 0.13% on the day. On the release front, Canada releases Building Permits, which is expected to rebound with a gain of 0.5%, following to straight declines. The U.S releases key inflation indicators this week, starting with Producer Price Index reports. PPI and Core PPI are both expected to post gains of 0.2%, after a decline of 0.1% in the previous release. The U.S. will also publish the Treasury Currency report, a semi-annual publication. On Thursday, the U.S will release CPI reports and unemployment claims.

Will there be any surprises in the U.S Treasury currency report?. The report provides details of global exchange rate policies, as well as a list of countries which are deemed currency manipulators. In the April report, the U.S did not name any of its major partners as currency manipulators. Since then, the Trump administration has imposed some $200 billion in tariffs on Chinese goods. China has retaliated with its own tariffs on U.S goods, and there has been speculation that China could respond to the U.S tariffs by devaluating the Chinese yuan in order to bolster Chinese exports. In 2015 and 2016, the markets dropped sharply on fears that China would implement a major devaluation of its currency. Traders should treat the report as a market-mover.
 
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