When is Canadian monthly Retail Sales report and how could the data affect USD/CAD?
Canadian Retail Sales Overview
Statistics Canada is scheduled to publish the monthly Retail Sales figures for June later this Friday at 12:30 GMT. The headline sales are estimated to register a modest rise of 0.3% during the reported month, down sharply from the 2.2% growth recorded in May. Excluding autos, core retail sales probably climbed by 0.9% in June against the 1.9% increase in the previous month.
According to Jing Ren, Analyst Orbex, Canada's figures aren't adjusted for inflation and the expected fall would reflect the improving inflation situation. “Annual retail sales are expected to have grown 9% compared to 14.1% in the prior report. Again, the annual comparables likely due more to covid effects last year, than the current situation,” Jing explains further.
How Could it Affect USD/CAD?
Ahead of the key release, a fresh leg down in crude oil prices undermined the commodity-linked loonie. This, along with sustained US dollar buying, lifts the USD/CAD pair to a one-month high, closer to the 1.3000 psychological mark. The data, meanwhile, might do little to provide any respite to the Canadian dollar, though a significant divergence from the expected readings could still infuse some volatility.
Disappointing domestic data would be enough to exert additional pressure on the Canadian dollar and lift the USD/CAD pair towards the next relevant hurdle near the 1.3035 zone. The momentum could further get extended to the 1.3080 horizontal level en route to the 1.3100 round-figure and the recent daily closing highs, around the 1.3115 region.
Conversely, a stronger reading could offer some support to the CAD, though the immediate reaction is likely to be short-lived amid the underlying bearish sentiment around crude oil prices. Hence, any meaningful pullback is more likely to find decent support near the 1.2935-1.2925 strong resistance breakpoint. Some follow-through selling could drag the USD/CAD pair further below the 1.2900 mark, though the downside is likely to remain limited near the 1.2845-1.2840 zone.
Key Notes
• USD/CAD marches towards 1.3000 as yields propel DXY, oil eases ahead of Canada Retail Sales
• USD/CAD Forecast: Bulls look to seize control near 50% Fibo., move beyond monthly peak awaited
• USD/CAD Price Analysis: Further upside hinges on 1.2980 breakout
About Canadian Retail Sales
The Retail Sales released by the Statistics Canada is a monthly data that shows all goods sold by retailers based on a sampling of retail stores of different types and sizes. The retail sales index is often taken as an indicator of consumer confidence. It shows the performance of the retail sector in the short term. Generally speaking, the positive economic growth anticipates bullish movements for the CAD.