USD/CAD has posted gains on Friday, as the pair continues to move higher. The Canadian dollar has slumped over Thanksgiving, losing about 150 points since Thursday. USD/CAD is trading just under the 1.14 line, a 2-week high. On the release front, Canada will release GDP as well as the Raw Materials Price Index. The markets are expecting good things, with the estimate for GDP at 0.4% and a forecast of a 1.5% gain for the RMPI.
Canadian Current Account posted a strong reading in Q3, as the deficit narrowed to C$8.4 billion, compared to C$11.9 billion in Q2. This marked the third consecutive drop in the deficit. Earlier in the week, Canadian Core Retail Sales improved to 0.0% in the September release. Although this was shy of the estimate of 0.4%, the indicator snapped a streak of two declines. Canadian Retail Sales was sharp, posting a 0.8% gain. This beat the estimate of 0.6%, and came after two consecutive declines. Retail Sales is the primary gauge of consumer spending, a key engine of economic growth.
Ahead of the Thanksgiving holiday, the US released a batch of data on Wednesday and the numbers were anything but impressive. Unemployment Claims jumped to 313 thousand, its highest level since mid-September. Core Durable Goods Orders declined 0.9%, its third decline in four readings. The estimate stood at 0.5%. New Home Sales fell to a 3-month low, dropping to 458 thousand. This was short of the estimate of 471 thousand. Pending Home Sales was no better, declining by 1.1%, well off the estimate of 0.9%. There was better news from UoM Consumer Sentiment, which posted a fourth straight gain, rising to 88.8 points. However, this was short of the estimate of 90.2 points. Despite the weak numbers, market sentiment towards the US economy remains high, and the US dollar has posted a strong rally against its Canadian counterpart.
USD/CAD 1.1389 H: 1.1393 L: 1.1335
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