The Canadian dollar gained to a more than six-week high as factory sales rose at the fastest pace in five months in July, adding to signs economic growth is picking up.
The currency advanced a second day versus its U.S. peer as the cost of living in America rose less than forecast in August, a sign it will take time for inflation to reach the U.S. Federal Reserve’s goal. The Federal Open Market Committee completes a two-day meeting tomorrow after which policy makers will announce whether they will slow monthly asset purchases, which are aimed to stimulate the economy and may also devalue the U.S. currency.
“Stronger-than-expected Canadian manufacturing sales, combined with some weaker U.S. data, has pushed the U.S. dollar down a little bit,” said Shaun Osborne, chief currency strategist at Toronto-Dominion Bank. The sales number “does enhance the outlook for July gross domestic product to some degree — obviously, a much better-than-expected result.”
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.