The Canadian dollar posted small gains last week, closing at 1.3090. This week’s key events are Core Retail Sales and CPI. Here is an outlook on the major market- movers and an updated technical analysis for USD/CAD.
In the US, retail sales and CPI were better than expected and also Yellen sounded upbeat about the US economy. Canadian Manufacturing Sales jumped 2.3%, well above the forecast of 1.4%. This marked the indicator’s strongest reading in 11 months.
Updates:
USD/CAD daily graph with support and resistance lines on it. Click to enlarge:
- Wholesale Sales: Monday, 13:30. This indicator slipped to 0.2% in November, shy of the forecast of 0.3%. The estimate for the December report is 0.4%.
- Core Retail Sales Sales: Wednesday, 13:30. This event should be treated as a market-mover, as an unexpected reading could have a strong impact on the direction of USD/CAD. In November, the estimate slipped to 0.1%, matching the forecast. The markets are expecting a strong improvement in December, with an estimate of 0.8%.
- Retail Sales: Wednesday, 13:30. Retail Sales is the primary gauge of consumer spending. The indicator dropped to 0.2% in November, short of the estimate of 0.5%. The downward trend is expected to continue in December, with a forecast of 0.1%.
- Corporate Profits: Thursday, 13:30. Corporate Profits jumped 14% in Q3, after posting declines over four straight quarters. Will we see another strong reading in Q4?
- CPI: Friday, 13:30. Canadian inflation levels remain at low levels, with CPI posting two straight declines. In December, the index declined 0.2%, below the estimate of 0.0%. The forecast for January stands at 0.3%.
- Trimmed Core CPI: Friday, 13:30. Trimmed Core CPI was introduced in December 2016. It excludes the most volatile items that make up CPI. The index has posted two straight readings of 1.6%.
* All times are GMT
USD/CAD Technical Analysis
USD/CAD opened the week at 1.3118 and touched a low of 1.3009, as support held at 1.3003 (discussed last week). Late in the week, the pair climbed to a high of 1.3126. The pair closed the week at 1.3090.