A disappointing report from Canada: the economy squeezed by 0.3% m/m in October, worse than expected. There is little comfort in the upwards revision for September: a growth rate of 0.4% instead of 0.3% originally reported. Year over year, the economy grew by 1.5%, also below 1.8% predicted.
USD/CAD broke above yesterday’s 1.3520 peak and reached a new high at 1.3546. Things aren’t going well for the C$.
Canada was expected to report 0% growth in October 2016, the first month of the last quarter. In September, the nation’s economy grew by 0.3%. Canada is unique in publishing its GDP numbers on a monthly basis.
USD/CAD topped the 1.35 level, trading around 1.3515 ahead of the publication. The loonie suffered under the weight of the greenback in the second round of USD buying after last week’s hawkish FED decision.
Trading conditions are quite thin as we enter the holiday season. Low trading volume and low liquidity can create “air pockets” where small orders can result in wide-ranging moves. Next week will be similar and everything will return to normal in early January.
We will later get the home sales data from the US as well as the revised consumer sentiment estimate. These will be the last figures before the holiday.
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