Canadian Inflation Data Could Shift Rate Cut Expectations

Canada's CPI inflation data on Tuesday expected to show inflation slowing to 3.3% YoY in January from 3.4% in December.

Lower energy and food prices likely behind expected slowdown, but core inflation seen remaining sticky.

Data will impact market expectations for timing of first Bank of Canada (BoC) rate cut.

Softer than expected data could bring early rate cut bets back on table, weaken Canadian Dollar.

USD/CAD could drop below 1.34 on hotter figures that keep "higher rates for longer" narrative alive.