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All Eyes on Bank of Canada Tomorrow; Oil Prices Cool From 3 Year Highs

Published January 16, 2018
  • The uncertainty related to NAFTA talks continue to weigh down the value of the loonie against the greenback, though CAD is up this morning versus most other majors. Yesterday, US House Speaker Paul Ryan said that Canada’s advantage in agriculture is the “largest problem with NAFTA”.
  • Yesterday, both crude benchmarks reached their best levels since December 2014. Brent and WTI are both down over 1% on the day, currently trading near $70 and $64 per barrel respectively.  Analysts and traders have recently warned that US shale producers could ramp up production in the coming weeks as they look to take advantage of higher prices, potentially derailing an OPEC-led effort to curb supply.
  • December inflation in the UK eased for the first time in six months due in large part to air fare costs. The rate fell to 3.0%  from 3.1% the previous month, which was the fastest decline in more than five years. Core CPI slipped to a five-month low of 2.5%. The Office for National Statistics said it’s too early to say if the move is the “start of any longer-term reduction in the rate”.
  • Big news of the week comes tomorrow at 10:00am EST when the Bank of Canada makes its rate announcement and reports on monetary policy.