USD/CAD is showing little movement on Monday, continuing the trend which characterized the pair for most of last week. In the North American session, the pair is trading at in the mid-1.12 range. In economic news, US Pending Home Sales posted a weak gain of 0.3%, well off the estimate of 1.1%. There are no Canadian releases on today’s schedule. On Tuesday, we could see some activity from the pair, as the US releases two key events – Core Durable Goods Orders and CB Consumer Confidence.
In the US, last week’s jobless numbers were softer than expected. Unemployment Claims rose to 284 thousand, much higher than the previous reading of 264 thousand, and above the estimate of 269 thousand. However, the markets were not overly concerned, as the four-week average, which is less volatile than the weekly release, dipped to 281,000, a 14-year low. Meanwhile, weak inflation levels continue to point to slack in the economy. On Wednesday, this trend continued with soft consumer inflation numbers. CPI and Core CPI both posted small gains of 0.1%.
Canadian retail sales numbers were a disappointment last week. Retail Sales, the primary gauge of consumer spending, looked weak in September, posting a decline of 0.3%. This marked a second straight decline and was the weakest showing since January. The markets had anticipated a gain of 0.1%. Retail Sales also came in at -0.3%, shy of the estimate of +0.1%. The markets then shifted their attention to the BOC, which maintained rates at 1.0%, as expected. However, the central bank did remove the word “neutral” from its statement, which was used in the September statement with regard to the BOC’s stance on a rate hike. This helped the loonie recover from sharp losses sustained after the soft Retail Sales Report.
USD/CAD for Monday, October 27, 2014
USD/CAD October 27 at 15:15 GMT
USD/CAD 1.1244 H: 1.1255 L: 1.1213
- USD/CAD continues to trade within range and has been uneventful.
- 1.1124 continues to provide strong support.
- On the upside, 1.1278 is a weak line and could face pressure during the day.
- Current range: 1.1124 to 1.1278
Further levels in both directions:
- Below: 1.1124, 1.1004, 1.0961 and 1.0865
- Above: 1.1278, 1.1414, 1.1493 and 1.1669
OANDA’s Open Positions Ratio
USD/CAD ratio is almost unchanged on Monday. This is consistent with the lack of movement displayed by the pair. The ratio has a majority of short positions, indicating trader bias towards the Canadian dollar breaking out of range and moving to higher ground.
- 13:45 US Flash Services PMI. Estimate 57.9 points. Actual 57.3 points.
- 14:00 US Pending Home Sales. Estimate 1.1%. Actual 0.3%.
* Key releases are in highlighted bold.
*All release times are GMT
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