USD/CAD – Canadian dollar steady, investors eye U.S. consumer confidence

USD/CAD is showing little movement in the Friday session. Currently, the pair is trading at 1.3282, down 0.08% on the day. On the release front, Canadian foreign securities purchases are expected to drop to C$7.6 billion. In the U.S., the Empire State Manufacturing Index is expected to rise to 7.1 and UoM consumer sentiment is projected to climb to 93.3 points.

Recent Canadian numbers have been mixed. The economy created 66.8 thousand jobs in January, crushing the forecast of 6.5 thousand. However, manufacturing sales has recorded declines of 1.3% in December and 1.4% in November. The manufacturing sector has sputtered, as the global trade war has lessened the demand for Canadian exports. As well, low oil prices are weighing on the economy and on the Canadian dollar. The currency has slipped 1.2% in February. The Bank of Canada is unlikely to raise rates at the March 6 meeting, but there is room for rate hikes later in the year if economic growth improves.

In the U.S., consumer data has been dismal in January. Retail sales and core retail sales showed sharp contraction, and these numbers came on the heels of soft inflation indicators. Inflation remains low, despite a solid U.S. economy and strong labor market. CPI showed no change in January, and has failed to post a gain since November. Core CPI has recorded weak gains of 0.2% for four successive months. On an annualized basis, CPI gained 1.6% in January, the weakest year-over-year gain since mid-2017. The soft inflation numbers were a result of low energy prices, which fell 3.1% in January as oil prices remain under pressure.

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USD/CAD Fundamentals

Friday (February 15)

  • 8:30 Canadian Foreign Securities Purchases. Estimate 7.6B
  • 8:30 US Empire State Manufacturing Index. Estimate 7.1
  • 10:00 US Preliminary UoM Consumer Sentiment. Estimate 93.3

*All release times are EST

*Key events are in bold

USD/CAD for Friday, February 15, 2019

USD/CAD, February 15 at 8:22 EST

Open: 1.3296 High: 1.3313 Low: 1.3278 Close: 1.3284

USD/CAD Technical

S3 S2 S1 R1 R2 R3
1.3049 1.3125 1.3200 1.3290 1.3383 1.3445

USD/CAD posted small gains in the Asian session but retracted in European trade

  • 1.3200 is providing support
  • 1.3290 was tested earlier in resistance. It is a weak line
  • Current range: 1.3200 to 1.3290

Further levels in both directions:

  • Below: 1.3200, 1.3125 and 1.3049
  • Above: 1.3290, 1.3383, 1.3445 and 1.3547

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.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.