Hawkish commentary by Federal Reserve officials underpinned the US Dollar. US economic data was mixed as unemployment claims dropped, while housing data delivers a gloomy outlook.
Wednesday\u2019s Canadian Consumer Price Index failed to underpin the Canadian dollar which weakened versus the US Dollar after Federal Reserve policymakers expressed that inflation remains too high and rates need to be above the 5% threshold. These remarks and commentary suffice to undermine investors\u2019 sentiment.
Wednesday\u2019s positive US Retail Sales data and Thursday\u2019s claims for unemployment dropping below estimates justify additional Fed tightening. At the time of writing, the USDCAD is trading at 1.3366.
US equities were rattled by Fed officials reiterating the need to tackle inflation, led by the St. Louis Fed President James Bullard. Bullard commented that the policy rate is not \u201csufficiently restrictive\u201d and said that the Federal Funds rate would be in the area between 5% to 7%, which startled investors.
The economic calendar featured Housing Starts for October contracting 4.2% MoM beneath the last month\u2019s 1.3% contraction. Building Permits for the same period shrank 2.4% MoM vs. September\u2019s 1.4% increase. Later, US Initial Jobless Claims for the week ended on November 12 dropped 222K, below estimates of 225K and the previous week\u2019s 226K.
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