Loonie Advances As Canada Trade Deficit Narrows
June 06 2018 - 6:02AM
RTTF2
The Canadian dollar strengthened against its major counterparts
in the European session on Wednesday, after a data showed that the
nation's trade deficit narrowed more than expected in April. Data
from Statistics Canada showed that Canada's merchandise trade
deficit with the world narrowed to C$1.9 billion in April from
C$3.9 billion in March.
Economists had forecast a deficit of C$3.4 billion.
Canada's exports rose 1.6% to a record C$48.6 billion in April,
while imports were down 2.5% to C$50.5 billion.
Meanwhile, separate data showed that Canada building permits
tumbled more than forecast in April.
The building permits fell 4.6 percent in April, after rising 1.3
percent in March.
Economists were looking for a fall of 1.0 percent.
The loonie firmed to near a 2-week high of 85.64 against the yen
and a 6-day high of 1.2857 against the greenback, from its early
lows of 84.62 and 1.2974, respectively. On the upside, 87.00 and
1.27 are likely seen as its next resistance levels against the yen
and the greenback, respectively.
The loonie advanced to a 2-day high of 0.9852 against the
aussie, following a decline to 0.9919 at 1:30 am ET. If the loonie
continues its rise, 0.97 is possibly seen as its next resistance
level.
Data from the Australian Bureau of Statistics showed that
Australia's gross domestic product rose a seasonally adjusted 1.0
percent on quarter in the first three months of 2018.
That exceeded expectations for an increase of 0.8 percent
following the 0.4 percent gain in the previous three months. The
loonie reversed from its early low of 1.5239 against the euro,
rising to 1.5127. The next possible resistance for the loonie is
seen around the 1.50 level.
Survey data from IHS Markit showed that Germany's construction
sector activity expanded at the fastest pace in four months in May.
The construction Purchasing Managers' Index rose to 53.9 in May
from 50.9 in April.
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