The Canadian dollar jumped Friday to its highest level since January, with the currency-related exchange traded fund now testing its long-term resistance, after inflation exceeded the central bank’s target for the first time in over two years.

The CurrencyShares Canadian Dollar Trust (NYSEArca: FXC) was up 0.6% Friday. FXC is up 4.0% over the past three months and is now testing its 200-day simple moving average.

The Canadian currency, or colloquially known as the loonie for the depiction of the common loon on its face, strengthened to CAD1.0757 per USD Friday, the strongest level since early January.

The loonie was appreciating as traders bolstered wagers on higher interest rates, following data that revealed the consumer price index rose 2.3% in May year-over-year, reports Ari Altstedter for Bloomberg.

Core CPI, which excludes eight volatile goods like food and energy, rose 1.7%, compared to 1.4% in April.

The Bank of Canada has set an inflation target of 2%, which the inflation index reached in April for the first time since April 2012. The central bank has maintained a benchmark rate of 1% due to concerns that low inflation and weak exports will pressure the economy.

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