- Canada’s core retail sales fell short of expectations falling -0.3% m/m in April.
- The Bank of Canada core inflation accelerated to 1.5% y/y, inching above expectations.
- The Loonie fell more than 50 pips on the Canadian news.
The USD/CAD is trading at around 1.2866 up 0.53% on Thursday as the combination of Canadian retail sales and inflation disappointed, especially with core retail sales missing.
Canada’s retail sales month-on-month came above expectations at 0.6% versus 0.4% forecast in April with core retail sales coming below expectations at -0.3% versus 0.5% month-on-month. The Bank of Canada Consumer Price Index Core year-on-year in April came above expectations at 1.5% against 1.4% expected by analysts. The USD/CAD in an immediate reaction bounced more than 50 pips and is now trading in the 1.2850 region.
The Loonie found a ceiling in Asia just below 1.2850 and then lost about 60 pips to the downside ahead of the Canadian data.
On the larger picture, the US dollar remains strong as the US Dollar Index (DXY), which measures the greenback versus a basket of currencies, made a new multi-week high at 93.64 on Friday on the back of rising US Treasury yields.
USD/CAD 4-hour chart
The trend is neutral and the support is seen at the 1.2747 swing low and at 1.2727 cyclical low while resistances are seen at 1.2848 and 1.2926 swing high. The Loonie is trading above its 200-period simple moving average (SMA) but below its 50 and 100-period SMA suggesting a mild upward bias.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.