The New Zealand dollar was the runaway best performer this week

Loonie on the losing end

There was a major divergence this week in FX performance with the Australian and New Zealand dollars at the top of the chart and the Canadian dollar at the bottom.

The loonie has been a frustrating trade as the USMCA agreement has failed to provide any kind of lift. The frustration turned into a squeeze after soft retail sales and CPI data today raised questions about the path of BOC rates.

It was all about data for the kiwi as well as Q3 CPI rose to 1.9% y/y from 1.5% y/y, beating the +1.7% consensus and taking a rate cut off the table.

The lesson: For all the talk about politics and deals, the big markets movers this week were economic data. To take it even a step further, the pound lagged alongside the loonie and UK CPI was also soft.