USD/CAD: Options-related Selling Caps Advance

A sizeable 1.1400 vanilla expiry at 14:00 GMT is helping keep a lid on USD/CAD this morning. The buck is benefiting from firm core inflation figures which should keep the Fed on inflation-watch in the months ahead while the mixed housing data suggests the sector is not in free-fall, as many had feared. If the economy is not dragged down by housing as many had expected, the Fed will have to stay more focused on inflation than they otherwise would have been. Recent Fed speak shows that shift clearly. 1.1375 is near-term support followed by stronger support at 1.1345/50. USD/CAD trades at 1.1385.