Canada: Annual CPI falls to -0.4% in May vs. 0% expected

• Inflation in Canada continued to soften in May. 
• USD/CAD pair continues to trade in daily range below 1.3550.

Inflation in Canada, as measured by the Consumer Price Index (CPI), was -0.4% on a yearly basis in April, the data published by Statistics Canada showed on Wednesday. This reading followed April's -0.2% and came in lower than the market expectation of 0%. On a monthly basis, the CPI was 0.3%.

Meanwhile, the Bank of Canada's core CPI, which excludes volatile food and energy prices, edged lower to 0.7% annually from 1.2% in April and missed analysts' estimate of 1.4%.

Market reaction

The USD/CAD showed virtually no reaction to these figures and was last seen trading at 1.3540, where it was unchanged on the day.