Canadian retail sales advances by 0.6% in July and core sales by 0.8%, both better than expected. Small minor revisions didn’t make a difference. Inflation came out mostly as predicted: CPI +0.1% m/m, 1.3% y/y (0.1% below predictions). Core CPI is 0% m/m and 2.4% y/y, spot on.
USD/CAD slides 25 pips to 1.3075. The Canadian dollar seems to end the week on a more positive note, despite oil prices digging the bottom.
Canada was expected to report a rise of 0.1% in CPI m/m, or 1.4% y/y. Core CPI carried expectations of 0% m/m and 2.4% y/y. Retail sales carried expectations for a rise of 0.2% m/m and 0.5% m/m in core sales.
USD/CAD traded just under 1.31 towards the release.
On one hand, the fall in oil prices (driven partly by rising inventories) has hurt the Canadian dollar. On the other hand, the exit from USD longs (following the meeting minutes) has countered that effect. So, USD/CAD was capped under 1.3175 and supported at the round 1.30 level.
More:
- Don’t Sell CAD Around Current Levels – Credit Agricole
- Buying USD/CAD – Morgan Stanley Chart Of The Week
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