The Loonie continued falling last Friday and the USD/CAD pair increased almost 0.5 percent (weaker Loonie). Risk aversion captured the entire Friday trading session, but it got worse when retail sales numbers were published. Retail sales decreased for the third consecutive month according to Statistics Canada, declining 0.3 percent to CAD 50.1 billion in January. Sales were down in 4 of 11 subsectors, which represent 52 percent of retail trade. The Loonie was the biggest loser last week, decreasing 0.7 percent versus the Greenback, 0.6 percent versus the Euro, 0.4 percent versus the Pound, and 0.9 percent versus the Aussie dollar. Not long ago, last Wednesday, Canadian Finance Minister Bill Morneau said that Canada is not heading into recession.
From the crude oil price standpoint, the OPEC seems to be having a terrible time assessing the outlook for demand. Furthermore, the change by the OPEC committee to delay an April meeting to June has created uncertainty and injected volatility into prices; this is creating some pressure on the Loonie.
Technically speaking, the USD/CAD is finding resistance at around 1.3450 and it might have a support at 1.3380 for today’s trading session.