Daily Currency Update
CAD - Canadian DollarThe USD/CAD pair increased 0.64 percent to the 1.3110 level, the highest intraday level (weakest level for the Loonie) right after the release of Canadian retail sales numbers, which came in at -0.3 percent when the expectation was +0.3 percent. Retail sales gauge sales at Canadian retail outlets, and they serve as a direct gauge of consumption and consumer confidence. They are also a crucial leading indicator for Canada.According to Statistics Canada, retail sales declined for the first time in four months, edging down 0.1 percent to $51.5 billion in May. Excluding sales at motor vehicle and parts dealers and gasoline stations, retail sales decreased 1.0 percent. Sales were down in 4 of 11 subsectors, representing 39 percent of retail trade. Technically speaking, the USD/CAD already hit a crucial significant resistance level at 1.3110, but if the weakness continues, it might test 1.3140. The critical support stays at 1.3050 followed by 1.3016 for today's trading session.
Key Movers
In other news, crude oil slid lower as the continuation of Russian pipeline flows increased concern about a lack of supply. Additionally, the lack of progress in U.S.-China trade talks further dented the demand outlook.The EUR/USD pair increased by the end of the trading session yesterday amid a decline of the U.S. dollar index after New York Fed President John Williams’s comments. He said, "…when you only have so much stimulus at your disposal, it pays to act quickly to lower rates at the first signs of economic distress." His comments were calling for preventive measures on rates rather than to wait for disaster to unfold.This morning the story is different; the U.S. dollar index is rising 0.45 percent and the EUR/USD pair is decreasing 0.46 percent, trading at 1.1226. The U.S. dollar is awaiting the consumer sentiment report from the University of Michigan, which will be released at 10 am Est as well as two speeches from Bullard and Rosengren, FOMC members.In other news, Treasury Secretary Steven Mnuchin said there's no change in the nation's currency policy "as of now," but he added "this is something we could consider in the future, but as of now there's no change to the dollar policy." His comments come as the Trump administration softens the long-held U.S. stance of supporting a strong dollar.
Expected Ranges
- USD/CAD: 1.3020 - 1.3110 ▲
- EUR/CAD: 1.4620 - 1.4735 ▼
- GBP/CAD: 1.6350 - 1.6400 ▲
- AUD/CAD: 0.9217 - 0.9252 ▲
- NZD/CAD: 0.8840 - 0.8891 ▲