CAD Strengthens to Session High Against the USD After Canadian Retail Sales Data
Published August 22, 2017
Retail sales in Canada edged up 0.1% month-over-month in June of 2017, below market expectations of a 0.3% rise. Core retail sales jumped up to 0.7% month-over-month in June, above the forecast of 0.3%. This may be off-setting some of the weakness we saw in the manufacturing sector in June. After this was released today, CAD strengthened substantially with the USD/CAD dipping below 1.2540
The Euro fell against the dollar today, retracing most of its overnight gains as a broadly resurgent greenback prompted investors to square positions in a thin market before the Federal Reserve Economic Symposium in Jackson Hole, Wyoming later this week where ECB president Draghi may shed some light on the tapering of their monetary stimulus program
The ZEW Indicator of Economic Sentiment for Germany fell sharply by 7.5 points to 10, well below the consensus of 15 and forecast of 15.9. Weaker than expected German exports as well as the widening scandal in Germany’s automobile sector raised doubts about the future path of growth and thus leading to the lowest reading since October 2016
NAFTA negotiators will meet again in Mexico on September 1 to continue trying to revise the trade pact. With the three countries keen on seeing a new deal emerging, they will still need to navigate the political risks attached to any commercial agreement
Crude oil prices slipped lower to start today’s session (WTI -0.25%) as markets await weekly U.S. stockpile data to be released by the American Petroleum Institute later in the day. Since the beginning of the year OPEC and non-OPEC producers (including Russia) agreed to cut production by 1.8 million barrels per day to help curb global oversupply, though these agreements have in fact had little impact on global stockpiles due to increasing production from countries that did not come to the table, specifically the U.S., Nigeria, and Libya. The Canadian dollar generally benefits from higher oil prices, and some of the recent volatility in crude prices has been reflected in the value of the Loonie.