• Annual CPI in Canada remained at 4.7% in November as expected, whilst the BoC's Core measure eased.
• The loonie was weaker as a result, with USD/CAD pushing back to multi-month highs in the 1.2880s.  

Annual inflation in Canada, as measured by the Consumer Price Index (CPI), advanced to 4.7% in November, unchanged from the 4.7% annual pace of price gain observed in October, data published by Statistics Canada revealed on Wednesday. This reading was in line with expectations. The MoM pace of headline consumer price growth was 0.2%, also in line with expectations, though down from last month's 0.7% reading. 

The BoC's Core measure of CPI stagnated on a MoM basis in November (i.e. came in at 0.0%), versus forecasts for a gain of 0.1%. YoY, BoC Core CPI decelerated to 3.6% in November, as expected, from 3.8% the month prior. 

Market Reaction

USD/CAD saw upside in response to the largely cooler than expected Canadian inflation readings, with the pair marginally surpassing earlier session highs at 1.28846 to print fresh multi-month highs at 1.28861. The pair has since dipped back slightly to 1.2880 again and will likely remain rangebound ahead of remarks from BoC Governor Tiff Macklem at 1700GMT and then the Fed policy announcement at 1900GMT.