The Canadian dollar rallied higher against its major rivals on Wednesday morning after the Statistics Canada report showed that Canadian consumer prices fell worse than expected in April. The Canadian dollar surged to a new multi-month high against the US dollar and new multi-day highs against the yen and the euro. Statistics Canada said today that its consumer price index declined to 0.4 percent during the month from 1.2 percent in March. Analysts had predicted an annual inflation rate of 0.6 per cent for April and a core rate of 1.8 per cent. The Consumer Price Index declined 0.1 percent between March and April, from 0.2 percent rise in March. Analysts were expecting 0.2 percent increase on Month. On a yearly basis, the consumer price index rose 0.4% in April, down from 1.2 percent posted in March. At the same time, the Statistics Canada also revealed that Canada's composite leading indicator fell by 1.1 percent in April. The housing index, a composite of housing starts and sales, fell 1.2 percent, while new manufacturing orders plunged 7.3 percent, the agency said. The Canadian currency surged to 1.1402 against the US dollar by 10:00 am ET, the highest mark since October 14, 2008. This may be compared to yesterday's close of 1.156. The Canadian dollar has gained more than 3.5 percent against the greenback since it reached a 12-day low of 1.1817. The greenback-loonie pair is presently trading at 1.141. In the U.S., crude oil inventories dropped for a second straight week, the Energy Information Administration reported today. The U.S. commercial crude oil inventories decreased by 2.1 million barrels in the week ended May 15. Experts were looking for a decline of about 1.5 million barrels of crude oil. At 368.5 million barrels, inventories remained above the upper boundary of the average range for this time of year. Following the report, light sweet crude oil for July delivery moved at $61.59, up $1.49 for the session. Prices briefly spiked as high as $62.14 following the report. The Canadian dollar advanced to a 9-day high of 1.5679 against the euro by 9:35 am ET and the pair is presently trading at 1.5736. On the upside, the Canadian currency may likely target the 1.564 level. The euro-loonie pair was worth 1.576 at Tuesday's close. In economic news from Europe, Italian industrial orders fell 2.7% month-on-month in March, taking the annual decline to 26%, statistical office Istat said today. Meanwhile, economists had expected a monthly fall of 2.5% and an annual 30.3% contraction.

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