Canada: Annual CPI declines to 5.9% in January vs. 6.1% expected

• Monthly CPI in Canada rose at a softer pace than expected in January.
• USD/CAD rises toward 1.3500 after soft inflation data. 

Annual inflation in Canada, as measured by the Consumer Price Index (CPI), declined to 5.9% in January from 6.3% in December. This reading came in below the market expectation of 6.1%. On a monthly basis, CPI rose 05% in January, compared to analysts' estimate of 0.7%.

Additionally, the Bank of Canada's Core CPI,  which excludes volatile food and energy prices, dropped to 5% on a yearly basis from 5.4% in December.

Market reaction

USD/CAD pushed higher with the initial reaction and was last seen gaining 0.22% on the day at 1.3480.