USD/CAD slides as hot Canada CPI dampens BoC rate cut odds

USD/CAD has fallen 0.5% (65 pips) to 1.3420 following the release of stronger-than-expected Canadian inflation data. Canada's April Consumer Price Index (CPI) rose 4.4% year-over-year, exceeding the forecast of 4.1% and accelerating from March's 4.2%. The robust inflation reading has reduced market expectations for a Bank of Canada (BoC) rate cut in June, bolstering the Canadian dollar. Conversely, the US dollar remains pressured by concerns over the country's fiscal situation and recent credit rating downgrade. USD/CAD is now testing key support at 1.3400, with a break below this level potentially triggering further losses toward 1.3350. However, resistance is noted at 1.3475, and a rebound above this level could negate the bearish momentum.