Ella 
In early Asian trading on Wednesday, USD/CAD edged higher to below the 1.3500 mark. Stronger-than-expected US inflation data dampened market sentiment and boosted USD/CAD. U.S. retail sales in February will be the focus this week, with retail sales expected to rise to a monthly rate of 0.8% in February. USD/CAD is currently trading around 1.3492, up 0.01% on the day.
U.S. inflation, measured by the Consumer Price Index (CPI), unexpectedly rose to 3.2% in February, keeping the Federal Reserve from cutting interest rates until at least the summer. Elsewhere, core inflation, which excludes volatile food and energy prices, rose 0.4% monthly and a stronger-than-expected 3.8% annual rate. February inflation data will play a role in the Fed’s interest rate forecasts. Investors expect the Fed to keep interest rates between 5.25% and 5.5% at its March meeting, scheduled for next week.
In the Canadian dollar, analysts expressed concerns about Canada’s economic slowdown. Moody’s Analytics pointed out that if the Bank of Canada (BoC) does not cut interest rates as soon as possible, it will face the risk of economic pressure. Earlier this month, the Bank of Canada kept interest rates unchanged at 5% for the fifth consecutive meeting. Bank of Canada Governor Tiff Macklem said core inflation remains a concern and stressed it was too early to talk about cutting interest rates.
