On Tuesday there will be 3 things worth watching – German IfFO Business Climate, US Housing Price Index and Consumer Confidence. More details in our Market Overview.

What should we expect?

First data came up just few minutes ago. German Busines Climate published by IFO was better than expected – 110.5 pts vs 109.5 expected, prior 109.5.

We have to wait few hours more for S&P Case-Shiller publishing Housing Price Index. So far it was very volatile on monthly basis but YoY it was more stable. Analytics expect slowing down of the housing market what can weaken USD.

The last important information – US Consumer Confidence – will show up an hour later. Despite index is far from rejection levels more and more data indicates that it will be slowing down. The first sign of that should be seen today – according to market sentiment it will slow down from 104.1 pts to 101.0 pts.

Poloz in front of House of Commons

Yesterday in the evening we were following Stephen Poloz (gov of BOC) testimony in front of House of commons Financial Committee. The most important thing he said and what caused CAD movement:

‘We have to consider risk connected with longer waiting against cost of doing something faster. Our best plan for the moment is to wait another 18 months or so’.

Markets treated these words as a lack of determination to cut rates in the next 18 months. As a result USDCAD moved down over 100 pips in the end of the session. When next session started bulls managed to reject almost all this movement.

On the D1 there is still a fight with upper bound of the patter. Close above it will let to break from narrow area which created since May.