Canadian CPI data is expected to show some slowing in inflationary pressure, with the headline rate easing to 3.0% in the year. Prices are expected to rise 0.3% in the month. Core prices are expected to moderate but only slowly. 

Slowing headline inflation may weigh on the CAD – as it did for the USD last week – but there are limited implications for policy in the short run at least. 

The BoC has only just returned to tightening again and left the door open to doing more if required. Governor Macklem indicated last week the Bank expected inflation to fall to around 3% and hold there for some time. This might be about the best headline inflation data we get in a while.