Canada reported both retail sales and inflation numbers for July. The data was mixed, with disappointing inflation and encouraging retail sales.
The loonie played around and eventually got the upper hand, with USD/CAD falling.
The Consumer Price Index dropped by 0.2%, worse than 0.1% expected and Core CPI dropping 0.1% instead of a rise at the same scale. Year over year, Canadian CPI rose 2.1%, lower than 2.3% expected and core CPI only 1.7% contrary to 1.9% predicted.
Retail sales advanced by 1.1%, much better than 0.3% expected and above a revised +0.9% in June. Core sales jumped 1.5%, better than 0.4% and above an upwards revised 0.3%.
USD/CAD made another move higher to nearly 1.0980, but immediately retreated and is now trading under 1.0950, which continues serving as a magnate.
The markets are focused on Canada’s southern neighbor: heads of central banks are gathered in Jackson Hole, Wyoming and the key event is a speech by Fed Chair Janet Yellen at 14:00 GMT.
Analysis: Is a dovish Yellen already priced in?
Here is the USDCAD chart:
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