The Canadian dollar has edged lower in the Monday session. Currently, USD/CAD is trading at 1.2788, up 0.15% on the day. On the release front, the sole indicator is US CB Leading Index, with an estimate of 0.6%. On Tuesday, Canada releases Wholesale Sales and the US publishes Existing Home Sales. As well, US Federal Reserve Chair Janet Yellen will speak at an event in New York City.
Like its southern neighbor, Canada continues to grapple with low inflation levels. There were no surprises on Friday, as CPI posted a negligible gain of 0.1% for October, matching the estimate. The Bank of Canada remains cautiously optimistic about inflation – on Wednesday, Senior Deputy Governor Carolyn Wilkins said she expected wages to rise as the economy improved. Inflation levels remain well below the Bank’s inflation target of 2.0%, and the markets don’t expect another rate hike until 2018.
US housing numbers ended the week on a positive note, easily beating expectations. Building Permits for single-family homes jumped to 1.30 million, above the estimate of 1.25 million. The annualized pace of 839,000 building permits in October was the fastest since September 2007. Housing Start also sparkled, accelerating to 1.29 million, compared to an estimate of 1.19 million. The catalyst for the strong numbers were hurricanes Harvey and Irma, which caused massive damage in the southern part of the US. With rebuilding efforts well underway, construction numbers should remain strong in the fourth quarter.
Monday (November 20)
- 10:00 US CB Leading Index. Estimate 0.6%
Tuesday (November 21)
- 8:30 Canadian Wholesale Sales. Estimate 0.6%
- 10:00 US Existing Home Sales. Estimate 5.42M
- 18:00 US Federal Reserve Chair Janet Yellen Speaks
*All release times are GMT
*Key events are in bold
USD/CAD for Monday, November 20, 2017
USD/CAD, November 20 at 7:55 EDT
Open: 1.2764 High: 1.2802 Low: 1.2755 Close: 1.2788
USD/CAD edged higher in the Asian session and is showing little movement in European trade
- 1.2757 has switched to a support role. It is a weak line
- 1.2860 is the next resistance line
- Current range: 1.2757 to 1.2860
Further levels in both directions:
- Below: 1.2757, 1.2630 and 1.2532
- Above: 1.2860, 1.3015 and 1.3165
OANDA’s Open Positions Ratio
USD/CAD ratio is unchanged in the Monday session. Currently, long positions have a majority (59%), indicative of trader bias towards USD/CAD continuing to move higher.