Loonie Mixed After Canada Retail Sales, Consumer Inflation
November 23 2018 - 3:49AM
RTTF2
The Canadian dollar was trading mixed against its key
counterparts in the European session on Friday, following the
release of strong domestic retail sales for September and consumer
inflation for October.
Data from the Statistics Canada showed that the CPI rose 0.3
percent on a seasonally adjusted monthly basis from September, when
sales dropped 0.1 percent.
Economists had expected a 0.1 percent rise.
Core inflation, excluding food and energy, improved 0.4 percent
in October, in contrast with a -0.1 percent drop in the previous
month.
The consumer price index rose 2.4 percent year-on-year in
October following a 2.2 percent increase in September.
Separate data showed that Canadian retail sales grew more than
expected in September, driven by food and beverage stores.
On a month-on-month basis, retail sales increased 0.2 percent
after falling 0.1 percent in August. The reading was forecast to be
flat.
Core retail sales rose 0.1 percent, in line with economists
forecast. In August, core retail sales recorded a decline of 0.4
percent.
Oil prices declined despite Saudi Arabia's pledge to cut
production.
Crude for January delivery fell $3.3 to $51.26 per barrel.
The currency was lower against its major counterparts in the
Asian session, with the exception of the aussie.
The loonie advanced to a weekly high of 1.4958 against the euro,
from a low of 1.5077 hit at 2:00 am ET. If the loonie rises
further, 1.48 is seen as its next resistance level.
Flash estimates from IHS Markit showed that Eurozone private
sector grew at the slowest pace in nearly four years in November,
with slower expansions in both manufacturing and services.
The composite purchasing managers' index, or PMI, which combines
manufacturing and services, fell to 52.4 from 53.1 in October.
Economists had expected a score of 53.
The loonie appreciated to 0.9523 against the aussie, its highest
since November 14. The loonie is likely to find resistance around
the 0.94 area.
Although the loonie rose back to 1.3186 against the greenback
immediately after the data, it reversed direction shortly and fell
to a 2-day low of 1.3259. The loonie is seen finding support around
the 1.34 level.
The loonie quickly reversed its data inspired gains against the
Japanese currency, touching a 2-day low of 85.07. The loonie is
poised to find support around the 83.00 level.
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