Canadian Dollar Weakens After Core Retail Sales Fall Unexpectedly
19 May 2017 - 7:45PM
RTTF2
The Canadian dollar weakened against its major counterparts in
the European session on Friday, after data showed that the nation's
consumer price inflation matched forecasts, while core retail sales
fell unexpectedly.
Data from Statistics Canada showed that the consumer price index
rose a seasonally adjusted 0.5 percent on month in April, matching
expectations.
This follows a 0.2 percent drop in March.
Core inflation, excluding food and energy, ticked up 0.1 percent
month-on-month in April, after a 0.1 percent decline a month
ago.
Separate data showed that Canadian retail sales rose 0.7 percent
on a monthly basis in March, surpassing forecasts for a 0.3 percent
uptick. The February reading was revised to a 0.4 percent fall,
whose reading was previously reported as 0.6 percent decline.
Core retail sales fell 0.2 percent month-over-month in March,
slightly steeper than previous month's 0.1 percent slide.
Economists were looking for a gain of 0.2 percent.
The currency was higher before the release of data, buoyed by
higher oil prices. Oil prices rallied on optimism that oil
producing nations will agree on an extension of output deal at a
meeting next week.
The loonie spiked up against its major rivals in the Asian
session.
The loonie fell to 81.74 against the yen, from a 2-day high of
82.33 hit at 4:45 am ET. The loonie-yen pair is likely to find
support around the 80.00 area.
The loonie, having advanced to a 2-day high of 1.0077 against
the aussie at 9:00 pm ET, reversed direction and edged down to
1.0135. The loonie is seen finding support around the 1.02
level.
The loonie weakened to 1.5204 against the European currency, off
its previous 2-day high of 1.5089. Continuation of the loonie's
downtrend may see it challenging support around the 1.53 mark.
Figures from the European Central Bank showed that the euro area
current account surplus declined in March largely due to widening
shortfall on secondary income.
The current account surplus fell to a seasonally adjusted EUR
34.1 billion in March from a record EUR 37.8 billion in
February.
Following a 3-week high of 1.3554 hit at 8:15 am ET against the
greenback, the loonie eased off to 1.3598 after the data. If the
loonie extends fall, 1.37 is likely seen as its next support level.
Looking ahead, Eurozone preliminary consumer sentiment index for
May is due shortly.
US Dollar vs CAD (FX:USDCAD)
Forex Chart
From Apr 2024 to May 2024
US Dollar vs CAD (FX:USDCAD)
Forex Chart
From May 2023 to May 2024