While headline inflation is falling back to within the BoC’s inflation target range, BoC Governor Macklem’s comments last week clearly show the central bank is not celebrating a victory over inflation just yet. Headline inflation needs to get closer to 2% and core inflation needs to fall further. Signs of sticky prices today will give the CAD a mild lift at least.

Support has firmed up at 1.3350, ahead of major weekly trend support at 1.3335 so the low.mid 1.33s is looking perhaps a little more solid for the USD ahead of the holiday break. Firm resistance sits overhead between 1.3450/1.3500, however.

USD rallies still look a fade.