EUR/CAD softens below 1.6300 ahead of Canadian CPI inflation release

• EUR/CAD edges lower to near 1.6275 in Monday's early European session. 
• ECB's Rehn said the risk of inflation slowing shouldn't be overlooked.
• Signs that activity had resumed at the Russian port of Novorossiysk on the Black Sea weigh on the commodity-linked CAD. 

The EUR/CAD cross loses traction to around 1.6275 during the early European session on Monday. Nonetheless, the potential downside for the cross might be limited amid the cautious stance by the European Central Bank (ECB). The Canadian Consumer Price Index (CPI) inflation data for October will be the highlight later on Monday. 

Many ECB policymakers indicated that there was no need to adjust interest rates given current economic conditions. ECB Governing Council Member Olli Rehn cautioned that the risk of slowing inflation should not be overlooked, though upside risks remain. Rehn emphasized the need for strong bank buffers and a vigilant policy stance.

Meanwhile, ECB policymaker and Governor of the Central Bank of Latvia Mārtiņš Kazāks said on Friday that there is no need to adjust interest rates in the current situation. The central bank will remain vigilant to any dramatic change and will adjust rates if necessary. Markets are now pricing in less than a 50% possibility of another cut by July 2026, and a very low 4% odds for the December 2025 meeting, according to Reuters. 

Russia's Novorossiysk port resumed oil loadings on Sunday after a Ukrainian strike last week led to some damage and a suspension of operations for two days. The resumption of operations eases concerns about a disrupted oil supply and weighs on the Canadian Dollar (CAD), which is also heavily influenced by crude oil prices. It's worth noting that Canada is a major oil exporter, and lower crude oil prices tend to have a negative impact on the CAD value.