The Canadian Dollar (CAD) strengthened against the Pound (GBP) and other major peers on Wednesday after data showed that retail sales in the North American nation rose more than forecast in May. The ‘Loonie’ also advanced to a session high against the US Dollar (USD) before easing.
The CAD/GBP exchange rate advanced to 0.546, the CAD/USD exchange rate advanced to 0.931. The CAD/EUR exchange rate advanced to 0.691
According to Statistics Canada the nation’s retail sales increased by 0.7% in May, beating forecasts for a rise of 0.6%. The previous months figure meanwhile was revised higher to come in at 1.3%. Core retail sales, which remove car sales from the data, showed an increase of 0.1%. That figure fell short of forecasts for a figure of 0.3% and was down from April’s upwardly revised figure of 0.8%.
Sales increased in seven out of eleven categories marking 56% of total sales, including a 2.0% advance at the petrol pumps. The rise marked the seventh consecutive recorded increase. The sale of electronic goods fell however by 1.7%.
‘The underlying momentum in the Canadian economy is solid, and the Canadian Dollar is slowly becoming the favourite of traders once again’, said a currency analyst based in Montreal.
The ‘Loonie’ also received support from higher oil prices.
The Pound meanwhile remained under pressure from the release of July’s Bank of England policy meeting minutes. The report caused investors to pare back their bets for an interest rate rise to occur before the end of this year.
The minutes showed that policy makers voted unanimously to leave interest rates on hold at the record low 0.5%. Concerns over weak wage growth was said to be the main cause for the hesitation.
Wednesday’s gains for the Canadian Dollar could be short-lived as the markets turn their attention back to geopolitical events. Investors are remaining cautious after the European Union threatened to impose harsher sanctions upon Russia over the situation in Ukraine. Conflicts in Gaza, Syria and Iraq are also causing the markets to hesitate.
Canadian Dollar (CAD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Canadian Dollar,
,Pound Sterling,0.5465 ,
Canadian Dollar,,US Dollar,0.9321 ,
Canadian Dollar,,Euro,0.6916 ,
Canadian Dollar,,Australian Dollar,0.9866,
Canadian Dollar,,New Zealand Dollar,1.0734 ,
US Dollar,,Canadian Dollar,1.0725 ,
Pound Sterling,,Canadian Dollar,1.8294 ,
Euro,,Canadian Dollar,1.4455 ,
Australian Dollar,,Canadian Dollar,1.0125 ,
New Zealand Dollar,,Canadian Dollar,0.9319 ,
[/table]
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