Canada's CPI rose to 3.1% on gasoline. How do you trade CAD when fuel drives inflation?

Statistics Canada reported CPI inflation of 3.1% in September, up from 3.0% in August. Gasoline prices rose 27.8% on the year, while CPI excluding gasoline eased to 2.2% (CPI report). The agency linked the acceleration to crude oil prices, which reached their highest level since May.

When inflation is driven by oil, the Canadian dollar can move with crude rather than with domestic prices, so the usual reading of a CPI print may not apply. The Bank of Canada held its policy rate at 2.25% in September (report). It is worth asking how a fuel-led rise should be read against that decision.

We would like to hear how you trade CAD on a fuel-led CPI:

• Do you read a headline CPI rise as a signal for CAD, or check the excluding-gasoline figure first?
• How do you combine an oil move and a domestic inflation print when you trade USD/CAD?
• Would a fall in oil after a fuel-led inflation rise change your view of the loonie?
• Have you traded CAD on a CPI release and found oil did most of the work?

Oil prices and the Canadian dollar covers the link, and USD/CAD has the live price.

Please share your own approach and reasoning, not calls for others to copy. Posts that promise a direction or sell signals will be removed.