UK Inflation Flashes Higher

Morning Report: 06.30 London

• This morning, the US dollar is steady after minor gains yesterday, while the Japanese yen is extending its reversal off the lows.

• Oil prices are one of the key drivers behind this move as they make a sustained push towards $45.00.

• Commodities currencies are pausing this morning, with the AUD/JPY and NZD/USD unchanged after strong advances yesterday.

• The pound is pulling back this morning after gains yesterday on the back of bigger than expected UK inflation data.

Coming up today:

• We start the day with the UK BOE credit conditions survey at 09.30.

• This is followed by US core retail sales at 13.30, alongside PPI at the same time.

• Following this we have the BOC monetary policy report and rate statement. The BOC press conference follows at 16.15.

• Following this we have US crude oil inventories at 15.30.

Trade Idea:

• With oil prices pushing for $45 and industry bodies calling a bottom to the recent bear run, the oil heavy USD/CAD could have further to fall.

                     

A good way to play this is a LOWER trade predicting that the USD/CAD will close below 1.2500 in 50 days for a potential return of 231%.

                         
                                                         

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