EUR/CAD edges higher on Monday, trading around 1.6070 at the time of writing, up 0.11% on the day.
The pair maintains a positive bias despite a stronger-than-expected acceleration in Canadian inflation, which provides some support to the Canadian Dollar (CAD)
Canada’s Consumer Price Index (CPI) rose 3% YoY in July, following a 2.8% increase in June and exceeding market expectations. On a monthly basis, consumer prices increased by 0.5%. The Bank of Canada’s (BoC) core inflation measure, which excludes more volatile components such as food and energy, rose 2.3% YoY and 0.2% MoM.
The BoC’s other preferred inflation measures also point to a modest strengthening of price pressures. Common CPI accelerated to 2.7% from 2.6% previously, while Trimmed CPI rose to 1.9% from 1.8%, and Median CPI increased to 2% from 1.9%. According to the released data, higher gasoline and travel tour prices contributed to the acceleration in headline inflation in July, while slower growth in prices for food purchased from stores limited the increase.