Canadian Dollar Found Its Way Higher Amid US Data Drop-Off

By Joshua Gibson of FX Street

Saturday, February 15, 2025 2:40 PM EDT

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The Canadian dollar gained another 0.15% against the greenback on Friday.
Cooling US dollar demand gave the Loonie a much-needed leg up.
Canadian CPI inflation data looms ahead next week.

The Canadian dollar gained another leg up on the greenback on Friday, as it climbed around one-sixth of one percent against the safe haven US dollar. US Retail Sales figures came in much softer than expected in January, but investors held onto risk-on sentiment.

Canada was functionally absent from the economic data docket this week. Canadian Consumer Price Index (CPI) inflation data is due next week, slated for Tuesday. US Retail Sales contracted sharper than expected; not enough to knock investor sentiment off of the table entirely, but still enough to leave a mark on overly-aggressive US dollar bulls.

Market Movers: US Retail Sales Hindered Greenback Flows, Bolstered Loonie

The Canadian dollar rose 0.15% against the US dollar, which pushed the USD/CAD currency pair further below the 1.4200 mark.
US Retail Sales contracted by 0.9% in January, which was a much steeper decline than the expected -0.1%.
However, the previous month’s figure was revised upwards to 0.7%, which limited the fallout of January’s downside print.
US Industrial Production beat forecasts, bolstering market sentiment, although the figure still represented another backslide, falling to 0.5% versus the forecast 0.3% and last revised print of 1.0%.
Despite the overall below-expectations prints in key data, markets focused on the broad range of revisions, which skewed heavily higher.

Canadian Dollar Price Forecast

The Canadian dollar managed to chalk in its fourth straight session of gains against the greenback on Friday, but overall bullish momentum remained limited. The USD/CAD currency pair waffled further back below the 50-day Exponential Moving Average (EMA) near the 1.4280 level, but a firm technical floor still appeared to be priced in at the 200-day EMA, just south of the 1.4000 figure.