USD/CAD edges lower to 1.4130 area after CPI data

• Annual CPI in Canada fell to 0.9% in March from 2.2% in February.
• US Dollar Index stays relatively calm near 100 mark.
• WTI extends recovery toward $14 in early American session. 

The USD/CAD pair came under modest bearish pressure in the early trading hours of the American session and dropped to a fresh daily low of 1.4120. As of writing, the pair was trading at 1.4130, down 0.55% on a daily basis.

Inflation in Canada softens in March

The data published by Statistics Canada on Wednesday revealed that inflation in Canada, as measured by the Consumer Price Index (CPI), fell to 0.9% on a yearly basis in March and came in lower than the market expectation of 1.2%. Furthermore, the core CPI dropped to 1.6% from 1.8% in February.

Although the initial market reaction to these figures was relatively muted, recovering crude oil prices helped the commodity-related loonie to find demand. At the moment, the barrel of West Texas Intermediate is trading at $13,70, gaining 4.7% on the day.

On the other hand, the upbeat market mood seems to be further weighing on the pair by forcing the USD to weaken against its rivals. After rising to 100.50 area on Tuesday, the US Dollar Index (DXY) is staying in the negative territory near the 100 handle on Wednesday.

The only data from the US showed that the Housing Price Index in February rose to 0.7% from 0.3% but was largely ignored by the market participants.

Technical levels to watch for