Yesterday, Canada’s September Consumer Price Index (CPI) was announced at 1.6%, which was lower than the expected 1.9%. This led to selling pressure on the Canadian dollar. The CPI dropped significantly from the previous month’s 2.0%, which raised expectations that the Bank of Canada might lower interest rates. As a result, the CAD/JPY pair fell to 107.71 yen. However, since the market had already been anticipating a rate cut, some traders took profits and bought back the currency, pushing the rate back up to 108.34 yen.
On the same day, crude oil prices dropped after Israel stated it would not target Iranian oil facilities, adding more downward pressure on the Canadian dollar.
After CAD/JPY broke past the high of 109.80 yen, which was reached on September 2, profit-taking caused the pair to fall. Despite factors such as lower crude oil prices and expectations of a rate cut, the Canadian dollar has remained relatively stable against the yen.
The Canadian dollar has continued to weaken against the U.S. dollar, but the strong performance of USD/JPY has helped push CAD/JPY up. However, since USD/JPY is facing resistance around 150 yen, CAD/JPY is also expected to face resistance at 110 yen for the time being.
CAD/JPY Forecast Range: 108.50 yen – 107.40 yen (50%, BB standard)
Note: The information above does not guarantee any profits. Please make your own decisions when trading.