USD/CAD tumbles to four-month lows under 1.3300 after US CPI

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• USD/CAD trades at the lowest level since mid-February, under 1.3300. 
• Headline US CPI fell to 4% in May versus the 4.1% expected. 
• Investors expect a no-hike for Wednesday’s Fed decision.

The USD/CAD turned south on Tuesday, falling below 1.3300 as the US Dollar weakened following the release of local inflation data. With data coming below expectations, markets are now fully pricing in a no-hike by the Federal Reserve (Fed) on Wednesday. On the Canadian side, no relevant economic data will be released on Tuesday. The Loonie is also benefiting from higher Oil prices and positive risk sentiment.