Daily Currency Update

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The Loonie loses despite strong retail sales in Canada and following a strong Greenback

CAD - Canadian Dollar

The Canadian dollar is in decline with the USD/CAD pair bouncing to 1.3386, representing a 0.3 percent increase. The Loonie is losing this morning due to a strong US dollar (see the daily commentary about the USD). Market participants are ignoring robust local economic data and weighing stronger fundamentals in the US.

According to Statistics Canada, retail sales in Canada came in 0.8 percent higher in February, reaching $ CAD 50.6 billion. Sales were up in 5 of 11 sub-sectors, representing 73 percent of retail trade. The reading was 0.2 percent.

Technically speaking, the USD/CAD seems set up to continue to trade within a range this morning. Significant resistance levels are the 1.3400 handle and 1.3410. Important support levels are 1.3305 and 1.3294 for today’s trading session.

Key Movers

The weakness in the EUR/CAD pair this morning is due to the release of the IHS Markit Flash Germany PMI in the European session (PMI for the Eurozone came in at 51.3, below expectations). Growth of Germany’s private sector economy remained subdued at the start of the second quarter of the year, and it was weighed down by an export-led contraction in goods production. According to Reuters, the German government is considering incentives to increment corporate research and development after cutting its forecast for 2019 economic growth for the second time in three months, reflecting a worsening slowdown driven by a recession in manufacturing. German exporters are struggling with anemic demand from abroad as well. The EUR/CAD pair is falling 0.10 percent and it is trading at 1.5049 at the time of this writing.

Expected Ranges

USD/CAD: 1.3294 - 1.3399 ▲

EUR/CAD: 1.4983 - 1.5066 ▼

GBP/CAD: 1.7395 - 1.7462 ▲

AUD/CAD: 0.9546 - 0.9586 ▲

NZD/CAD: 0.8913 - 0.8966 ▼