The Canadian dollar falls as hopes for inflation to peak fade

Due to the fact that the US dollar shows a general increase, there is a weakening of the Canadian dollar against the US currency. Nevertheless, with the release of up-to-date data on inflation within the country, which caused growing expectations of a new significant increase in the interest rate by the Bank of Canada, there was a containment of the fall of the official currency of Canada.

Adam Button, chief currency analyst at ForexLive, said that the US currency is truly on the warpath. In his opinion, expectations regarding the peak of global inflation in the fall are not justified, and to see the reaction of central banks to this, one must wait.

Negative sentiment among investors were aggravated by new comments of officials-"hawks" from the Fed.

In September, annual inflation in Canada fell to 6.9%, being one step ahead of analysts' forecasts of 6.8%, while price pressure measures could not be eased.

The probability that the central bank will raise interest rates by three-quarters of a percentage point during the next meeting of the Bank of Canada, scheduled for October 26, is estimated by money markets at 69%. Before the publication of the data, this value was approximately 30%.

Button also added that the Canadian dollar would be much lower if it were not for oil.

Canada is one of the largest oil exporters in the world.