Canadian Dollar Extends Rise After Inflation Data
23 March 2018 - 8:50PM
RTTF2
The Canadian dollar extended its early rally against its key
counterparts in the European session on Friday, following the
release of a data showing higher than expected annual inflation
rate in Canada, which puts pressure on the Bank of Canada to raise
borrowing costs in the coming months.
Data from Statistics Canada showed that inflation rose 0.2
percent on a seasonally adjusted monthly basis in February,
compared to a 0.5 percent increase in January.
On year, inflation rose 2.2 percent in February, following a 1.7
percent increase in January. The rate was forecast to grow by 1.9
percent.
Separate data showed that Canadian retail sales increased 0.3
percent in January to C$49.9 billion. General merchandise stores
were the largest contributors to the increase.
This follows a revised 0.7 percent drop in December and was
lower than 1.1 percent growth seen by economists.
Core retail sales, excluding autos, grew 0.9 percent on a
monthly basis.
Economists had been looking for a 0.8 percent rise. The December
figure was revised to a 1.7 percent fall.
The loonie showed mixed trading against its major rivals in the
Asian session. While it held steady against the euro and the
aussie, it rose against the greenback. Against the yen, it
dropped.
The loonie advanced to 1.2835 against the greenback, from a low
of 1.2940 seen at 5:00 pm ET. The loonie is seen finding resistance
around the 1.26 level.
Data from the Commerce Department showed that U.S. durable goods
orders surged up much more than anticipated in the month of
February.
The report said durable goods orders jumped by 3.1 percent in
February after slumping by 3.5 percent in January. Economists had
expected durable goods orders to increase by 1.5 percent.
The loonie spiked up to more than a 3-week high of 0.9921
against the aussie and a 10-day high of 1.5836 against the euro,
reversing from its early low of 0.9983 and a 2-day low of 1.5963,
respectively. On the upside, 0.98 and 1.55 are likely seen as the
next resistance levels for the loonie against the aussie and the
euro, respectively.
The loonie rebounded to 81.97 against the yen, from a 4-day low
of 80.91 seen at 6:45 pm ET. The next possible resistance for the
loonie is seen around the 83.00 level.
Data from the Ministry of Internal Affairs and Communications
showed that Japan's consumer prices rose 1.5 percent on year in
February.
That was in line with expectations and up from 1.4 percent in
January.
Looking ahead, U.S. new home sales data for February is
scheduled for release shortly.
US Dollar vs CAD (FX:USDCAD)
Forex Chart
From Mar 2024 to Apr 2024
US Dollar vs CAD (FX:USDCAD)
Forex Chart
From Apr 2023 to Apr 2024