In European trade on Thursday (Oct 20), / fell back from high to trade at 1.3755, down 0.05%.
As analysts began to price in another 75 basis point rate hike as core inflation remained uncooled.
Given this, analysts believe the Bank of Canada will be disappointed by the report.
The Bank of Canada was among the first to tighten policy this year, raising rates by 300 basis points in an effort to control inflation.
The biggest one-off increase came in July, when the central bank raised rates by 100 basis points.
All eyes are on next week’s meeting, with markets pricing in a 75 basis point rate hike on October 26, rather than the 50 basis points previously forecast.
Bank of Scotiabank said it expects the Bank of Canada to raise rates to 4.25% in 2022 (from 3.25% now, or another 100 basis points).
Canada is feared to slip into recession in 2023.
After two days of gains, USD/CAD fell to around 1.3770 in early European trade on Thursday, with traders awaiting a clear breakout of triangle support.
In this case, the pair depict the indecision of the market.
In addition to the support line of the three-day symmetric triangle, the relative strength indicator (14) has also given USD/CAD buyers hope.
