- USD/CAD staged a modest recovery from multi-month lows set on Thursday.
- The USD struggled to preserve its early gains and kept a lid on any strong gains.
- Friday’s mixed US retail sales figures failed to provide any meaningful impetus.
The USD/CAD pair held on to its modest gains through the early North American session, albeit retreated around 15-20 pips from daily tops post-US macro data.
The pair to gain some positive traction on the last day of the week and stage a modest recovery from near six-month lows, or sub-1.3200 levels set on Thursday. The uptick was supported by a mildly softer tone surrounding crude oil prices, which tend to undermine the commodity-linked loonie, and an intraday US dollar rebound.
The USD, however, struggled to capitalize its early uptick, instead met with some fresh supply at higher levels amid the uncertainty over the next round of the US fiscal stimulus measures. The greenback was further pressured by a pullback in the US Treasury bond yields, led by a turnaround in the global risk sentiment.
Meanwhile, Friday's mixed release of the US monthly Retail Sales report failed to impress the USD bulls or provide any meaningful impetus to the USD/CAD pair. Data published by the US Census Bureau revealed that retail sales rose by 1.2% MoM in July, short of consensus estimates pointing to an increase of 1.9%.
The weaker headline number, to a larger extent, was offset by an upward revision of the previous month's reading to 8.4% from 7.5% reported earlier. Adding to this, sales excluding autos also came in to show a better-than-expected growth of 1.9% during the reported month. The closely watched Retail Sales Control Group climbed 1.4% in July as against 0.8% anticipated.
Friday's US economic docket also highlights the release of the Michigan Consumer Sentiment Index for August. The data, along with the broader market risk sentiment might influence the USD price dynamics and produce some short-term trading opportunities. The key focus, however, will remain on a crucial weekend meeting between the US and Chinese trade officials.
Technical levels to watch
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. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD regains traction, recovers above 1.0700
EUR/USD regained its traction and turned positive on the day above 1.0700 in the American session. The US Dollar struggles to preserve its strength after the data from the US showed that the economy grew at a softer pace than expected in Q1.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold climbs above $2,340 following earlier drop
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.