CAD/JPY Dips on Soft Canadian CPI: Buy the Dip to 115?

CAD/JPY pared some of its gains after weak Canadian CPI data.  It hits an intraday low of 112.48  and is currently trading around 112.79.

Canada's CPI data for November 2025 showed a modest 0.1% month-over-month rise, below the anticipated 0.2–0.3%, with the year-over-year rate steady at 2.2% and seasonally adjusted m/m at +0.2%. Core CPI-median fell to 2.9% y/y from 3.0%, CPI-trim remained steady at 2.7% y/y, and CPI excluding gasoline increased 2.6% y/y for the third month, indicating weak underlying inflation. While goods quickened with groceries at +4.7% y/y (led by beef +17.7% and coffee +27.8%), services slowed to +2.8% y/y amid travel declines. Rent declined -7.8% y/y but rose 1.8% m/m owing to refinery problems. Nationally, rent eased to +4.7% y/y, with New Brunswick experiencing the most dramatic provincial growth.

Technical Analysis

CAD/JPY is currently trading above  the 34- and 55-EMA  and above 200 EMA and 365 EMA on the 4-hour chart. The immediate resistance is at 113; a breach above that level could shift targets to 114/114.69/115. On the lower side, near-term support is at 112.50,and a break below this support could lead to declines toward 112/111.69/ 111/110.50/110/109.50/109.

Indicator Trends

 CCI (50)- Bullish

ADX (14)-  Neutral

Trading Strategy Recommendation

It is good to buy on dips around 112 with a stop-loss at 110.85 for a target price of 115.