CAD Stalled With Oil, GDP In The Limelight Now

  • USD/CAD advanced on weak Canadian data, as oil failed to advance.
  • Canadian GDP stands in a week dominated by the Fed.
  • The technical picture is mixed for the pair.

This was the week: Weak data all around

The Canadian Dollar was on the back foot as data missed expected. Manufacturing Shipments fell by 1.4%, Wholesale Sales by 1% and most importantly, Retail Sales dived by 0.9%. November was not a great month for the Canadian economy.

Oil prices did not help. After three consecutive weeks of significant advances, the price of the black gold stalled, consolidating previous gains. A buildup in inventories weighed.

In the US, the US government shutdown continued. The debacle hurts the economy as 800,000 are not paid. Also, quite a few economic releases were postponed. We did learn that Existing Home Sales continued falling, exposing the weakness of the sector. However, Jobless Claims set a new multi-decade record low, showing that the labor market is resilient.

Talks between China and the US did not go anywhere fast, slightly weighing on the loonie, a risk currency. The same goes for the release of Chinese GDP: showing that 2018 saw the weakest growth in 28 years.

Canadian events: GDP

The Canadian calendar is quite light as January draws to an end, with the Gross Domestic Product report the only data point that stands out. The Canadian economy grew by 0.3% in October, a promising start to Q4. The figure for November may be somewhat weaker. The publication is accompanied by the Raw Materials Price Index (RMPI) and the Industrial Product Price which provide insights into inflation.

Oil prices may play a more significant role in setting the next moves for the C$ as they may wake up after a quiet week.

Here is the Canadian calendar for this week:

Canadian calendar events January 28 February 1 2019

US events: Fed, NFP eyed

The US government shutdown removes the all-important GDP release from the American macroeconomic calendar. Nevertheless, the turn of the month is quite busy.

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