- Retail sales decline by 0.9% in Canada.
- BoC’s Poloz repeats that the monetary policy is data dependent.
- WTI clings to small gains above $53.
After dropping toward the 1.33 handle, the USD/CAD pair gained traction in the last hour and erased a majority of its daily losses as the CAD came under selling pressure following the disappointing retail sales data from Canada. As of writing, the pair was down 0.1% on a daily basis at 1.3340.
Statistics Canada on Wednesday reported that retail sales in November declined by 0.9% following October’s 0.2% growth and fell short of the market expectation for a 0.6% decrease. “Sales at gasoline stations declined for the third time in four months, decreasing 5.0% in November. The decline was largely attributable to lower prices at the pump. In volume terms, sales were down 1.5%,” the publication said to highlight the negative impact of lower oil prices on the Canadian economy.
Following yesterday’s 1.75% drop, the barrel of West Texas Intermediate trades in a tight range a little above the $53 handle, making it difficult for the commodity-related loonie to show resilience against its rivals.
Meanwhile, in an interview with Bloomberg in Davos, BoC Governor Poloz reiterated that the global trade tension was a two-sided risk and that their monetary policy was data dependent.
Later in the day, Richmond Fed Manufacturing Index from the United States will be looked upon for fresh impetus.
Key technical levels
1.3300 (psychological level/daily low) aligns as the initial support for the pair ahead of 1.3230 (Jan. 18 low) and 1.3180 (Jan. 9 low). On the upside, resistances align at 1.3355 (daily high), 1.3390 (50-DMA) and 1.3445 (Dec. 6, 2018, high).
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