• USD/CAD ticks down after the Canadian Retail Sales data came in line with expectations and the prior release.
  • Steady Canadian Retail Sales growth would weigh on BoC’s large rate-cut bets.
  • Investors await the flash US S&P Global PMI data for November.

The USD/CAD pair surrenders its entire intraday gains and ticks down as the Canadian Retail Sales data grew steadily in September and the US Dollar (USD) gives up a majority of its intraday gains after refreshing a two-year high.

Statistics Canada showed that Retail Sales, a key measure of consumer spending that drives inflation, rose by 0.4%, in line with estimates for the month. Steady sales were driven by higher spending on food and beverages, while sales receipts at gasoline stations were lower. Steady growth in the consumer spending measure is expected to weigh on market expectations that the Bank of Canada (BoC) will cut interest rates consecutively for the second time by 50 basis points (bps).

Market speculation for BoC outsize interest rate cuts was already diminished slightly after the release of the Consumer Price Index (CPI) data for October, which showed that price pressures accelerated at a faster-than-expected pace.

The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, drops from 108.00 to near 107.50.

The outlook of the US Dollar remains firm as investors expect that the Federal Reserve (Fed) will be one of those central banks among Group of Seven (G7) nations, which will follow a more gradual approach. Market expectations for the Fed to cut interest rates slowly are strengthened on expectations that the United States (US) inflation and economic growth will accelerate after President-elect Donald Trump implements his trade and tax policies.

Going forward, investors will pay close attention to the US flash S&P Global Purchasing Managers’ Index (PMI) data for November, which will be published at 14:45 GMT.

 

Read the full article here

Share.

Leave A Reply

Your road to financial

freedom starts here

With our platform as your starting point, you can confidently navigate the path to financial independence and embrace a brighter future.

Registered address:

First Floor, SVG Teachers Credit Union Uptown Building, Kingstown, St. Vincent and the Grenadines

CFDs are complex instruments and have a high risk of loss due to leverage and are not recommended for the general public. Before trading, consider your level of experience, relevant knowledge, and investment objectives and seek financial advice. Vittaverse does not accept clients from OFAC sanctioned jurisdictions. Also, read our legal documents and make sure you fully understand the risks involved before making any trading decision