At the bottom of the hour, we will get February retail sales and March CPI. Current Forecast data for Core CPI for March expected at 1.5% while Core Retail Sales reading is expected at 0.3%.
"While on the surface that might look like cause for central bankers to accelerate the pace of rate hikes, the numbers are being buoyed by the effects of higher minimum wages in some provinces and the recent run-up in oil prices, neither of which are signposts of an economy at risk of overheating", said Royce Mendes, director and senior economist with CIBC World Markets.
The Canadian dollar is mostly higher today. This week, we've already seen evidence of wages growing in real terms as inflation has eased.
The price of gas and air transportation were the driving forces of inflation creeping up in Canada in March to 2.3 per cent from 2.2 per cent in February.
By the tone of BoC on Wednesday the central bank monetary policy makers are more concerned with the uncertainties around trade and the North American Free Trade Agreement (NAFTA). The loonie is strengthening against all major currencies except the Australian dollar. The bank concluded by stressing its intention to hike rates in the near future.
GBP/CAD could end the week near its opening levels, unless upcoming Bank of England (BoE) comments or Canadian ecostats surprise investors. The Bank of Canada maintained interest rates, while suggesting that accommodative policies were set to continue.
GBP/CAD Forecast: Bank of England and Canadian Inflation in FocusThe Pound to Canadian Dollar exchange rate is unlikely to see particularly strong performance before the end of the week as both currencies remain unappealing to investors.
Bank of England officials will be holding speeches in the coming days. While Poloz spoke of normalizing interest rates past year, his latest comments suggest that monetary policy is likely to remain accommodative.
The headline figures will be watched closely by CAD traders, as the Bank of Canada (BOC) struck a notably dovish tone following their latest Rate Decision that saw the central bank hold steady on rates, and a miss for CPI and sales figures could push out expectations of a rate increase.