Canadian Dollar (CAD) net short positions have decreased for the second week in a row, driven by a decrease in short positions. The Australian Dollar (AUD) net short positions have decreased for the first time in four weeks, driven by an increase in long positions, Rabobank's FX analysts jane Foley and Molly Schwartz note.

Market is pricing in a 25bp cut at the BoC meeting

"Canadian CPI inflation registered in line with expectations at -0.4% m/m, filtering through to a y/y print of 1.8%. The BoC is now equally concerned with CPI inflation registered above or below target 2.0%, and the market is pricing in a 25bp cut at the January 29th BoC rate decision."

"The RBA has been one of the most hawkish banks in this current rate cycle, and the market is now pricing in 77% of a 25bp cut at the next RBA meeting on February 18th . Q4 CPI inflation data are due on January 29."