USDCAD news - page 25
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USD/CAD Forecast Nov. 16-20 The Canadian dollar was almost unchanged last week, as USD/CAD closed the week at 1.3319. The upcoming week has seven events on the schedule, including retail sales and inflation levels. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD.
There were no major releases out of Canada last week, and the Canadian dollar had a quiet week. In the US, numbers were mixed. PPI and Retail Sales missed estimates, but UoM Consumer Sentiment beat the forecast. Earlier in the week, US jobless claims repeated at 276 thousand, coming in above the forecast for a second straight week. The Fed is leaning towards a hike, but is not yet fully committed to the move.
Updates:
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Canada Sept manufacturing sales -1.5% vs +0.2% expected Better late than never, Canadian data from Sept
This report is so old that it doesn't mean a heck of a lot for the Canadian dollar but North American traders are selling into the rally in oil and that will hurt the loonie.
Preview: Canadian Inflation to Hold Steady as Gasoline Prices Restrain Pace The Canadian CPI is expected to remain at 1% in October due to another drop in gasoline prices, according to analysts' consensus.
Meanwhile, the annual core CPI measure, which excludes eight volatile components, is projected to slow to 2%, still hitting the lower range of the Bank of Canada’s (BoC) target.
Fresh inflation figures will be released on Friday at 12:30pm GMT.
The muted inflation pace is only likely to weigh on the Canadian dollar, which has been trading flat ahead of the release.
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Canada retail sales for September -0.5% vs. 0.1% exp Ex Auto -0.5% vs -0.4% exp. The Canada retail sales for the month of September come in weaker than expectations at -0.5% for both the headline and the ex Auto number. The market was expecting a +0.1% for the headline and -0.4% ex auto. The prior month showed gains of +0.5% and 0.0% respectively.
The USDCAD initial reaction was to the upside (weaker CAD) to a high at the 1.3326 level, but the price is trading back lower to the 100 hour MA at the 1.3309. Oil is down 0.39 in early trading at 40.15.
The fall is being attributed to cheaper gasoline. Sales at gasoline stations fell 3.7%.
Excluding price changes, the sales rose 0.1% in September so the market seems to be discounting the decline in that respect. ]
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USD/CAD forecast for the week of November 16, 2015 The USD/CAD pair initially fell during the course of the week, but found enough support below to turn things back around and form a hammer. The market is in an uptrend to begin with, so therefore we are bullish. If we can break above the top of the hammer, and more importantly the 1.35 level, we are ready to continue going much higher. We have no interest whatsoever in selling at least until we get below the 1.28 handle, which is very unlikely at this point in time.
USD/CAD: Loonie Flat After Eyeing 2-Mth Lows on US Data, Lower Oil The USD/CAD climbed over the C$1.33 level as the US dollar was supported by macro data, while the resource-linked loonie faced resistance from lower oil prices.
The Canadian dollar edged down 0.05% to C$1.3311 against the greenback, after reaching an intraday low C$1.3371.
"[The] C$1.3300 has been a key level of USDCAD congestion since November 6th, and we await a clear break in either direction. Near term risk for CAD is centered on the US data and potential for position squaring as we approach the US holiday, with EIA oil inventory data a crucial consideration for oil prices. Yield spreads and oil prices remain the key drivers for CAD, with 30 day rolling correlations to both well above 0.80," Eric Theoret, currency strategist at Scotiabank, said to clients.
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October 2015 Canadian PPI -0.5% vs -0.1% exp m/m Details of the October 2015 Canadian PPI and raw materials prices report 27 November 2015
Staying Long USD/CAD Targeting 1.40 – Morgan Stanley The Canadian dollar was saved from lower ground thanks to the Saudis and their talking up of oil prices.
Will this last? Not so fast?
Here is their view, courtesy of eFXnews:
The rates market is barely pricing in any probability of BoC easing, a major disconnect given still low energy prices and signs of manufacturing turning over, notes Morgan Stanley.
“In short, we have a difficult time seeing how Canada will muster sustainable growth over the medium term, especially with an over-levered housing market and the knock-on effects of lower terms of trade yet to fully filter through to employment, wages and spending. With the Fed set to begin a tightening cycle in December, we think the BoC may well move in the other direction,” MS argues.
MS maintains a long USD/CAD position in its strategic portfolio from around 1.3287, with a stop at 1.3050, and a target at 1.40.
“The key risk to this trade is a surge in oil prices which would help CAD sentiment near-term,” MS adds.
Canada Q3 GDP 2.3% vs +2.3% expected Canadian third quarter GDP highlights:
Canada emerges from a minor recession.
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Bank of Canada holds rates at 0.50%, as expected Highlights of the Bank of Canada rate decision:
USD/CAD dipped down to 1.3355 then rebounded back to 1.3385.
On the CAD-positive side, the outlook for rates is exactly the same as it was before and they've brushed aside some negatives in exports.
On the negative side, they fret about Q4 growth and the US economy (a bit).
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