USD/CAD - Canadian Retail Sales Disappoint

US Dollar vs Canadian Dollar

The Loonie is trading higher today after Core Retail Sales unexpectedly jumped to 0.7% from the previous reading of -0.1% and market forecast was for 0%. Headline Retail Sales, which includes auto sales, on the other hand came in at 0.1% which is just slightly under the forecast of 0.2%. Oil prices remains soft as it consolidates from Monday’s decline.

The USD is strengthening against most of its G10 counterparts this morning. Equity markets are slightly higher while commodities are largely mixed. There are limited data releases today out of the US with only second tier data on deck. We’ll get US Richmond Manufacturing PMI later this morning, which the market is looking for a decline to a reading of 11 from the previous report of 14. There does not appear to be any clear driver for the USD gains, as markets trade with no clear tone going into the North American trading session this morning.

The expect a range today of 1.2480 to 1.2606

Canadian Dollar vs Euro and Great British Pound

German and Eurozone ZEW Economic Sentiments were disappointing as they printed at 10.0 and 29.3 respectively. Tomorrow will be more eventful with Draghi speaking in Germany as the main event followed by PMI data out of Europe. The Euro has fell back to monthly lows and is currently trading at 1.4750.

We expect a range today of 1.4708 to 1.4822

UK finance data in July had no effect on the Sterling even though Public Sector Net Borrowing exceeded expectations of 0.3B and printed at -0.8B. CBI Trends Total Orders in August also exceeded the market of 8 with a print of 13. The Sterling has dropped to fresh lows not seen since January 17th of this year. The GPB is currently trading at 1.6061.

We expect a range today of 1.6022 to 1.6143

Canadian Dollar vs Australian Dollar and New Zealand Dollar

The Aussie is trading slightly softer today despite a jump in iron ore prices. The main factor looks to be general USD strength today which should continue to drive the AUD move as we have no domestic data to work off. However, positive movements in iron ore and copper (new multi-year high) should help limit the losses.

Oil (WTI): 47.41
Gold: 1287.15
Silver: 17.07
Copper: 2.9884
Dollar Index: 93.45

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