⚡Crypto Alert : Altcoins are up 28% in just last month! Unlock gains and start trading now - Click Here

Retail Sales – The Other Factor for the CAD Besides Oil

Posted Tuesday, November 22, 2016 by
Skerdian Meta • 2 min read

Today is a big day for oil, oil traders and CAD traders. The OPEC countries are meeting in Vienna as we mentioned in one of our previous updates today. It´s almost certain that an agreement will be reached today, or is it?

A production freeze at current levels (or somewhere close) is the widely accepted idea, but there´s also an option of production cut which might leave out Nigeria and Libya, which have had a lot of troubles pumping up recently due to terrorist attacks. The catch here is that Iran and Iraq have to join this undertaking and they´re not happy about it, so let´s see how this meeting will go.

We know that oil prices are a big driver of the Canadian Dollar and the CAD pairs because of the huge amount of oil in the Canadian oil fields. But, oil is not all everything the CAD relies on, the economic data is another factor as in most major currencies.

There is a chance that the BOC (Bank of Canada) cuts the interest rates in December following Trump´s win in the US presidential elections. The RBNZ (Royal bank of New Zealand) cut the interest rates the day after the elections if you have forgotten.

Retail sales were expected to jump by 0.7% in October but they missed projections by 1 point which is not that bad. Last month´s Canadian retail sales were revised higher as well. The problem remains in the core retail sales though; they were supposed to increase by 0.2% but they came out flat.

Besides that, if we strip out vehicle sales and gasoline then we can say that the retail sales have dived 0.2% in October. This is a bearish indicator because that means that the Canadian consumers have cut back on expenses elsewhere. This is not a good sign for the CAD and if we see another negative round of economic numbers from Canada then you bet a rate cut is coming. So, be careful with USD/CAD longs, even if a deal is reached in Vienna. 

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
Related Articles
Comments
0 0 votes
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments