USD/CAD rises above 1.32 as the Canadian consumer softens | Forexlive
USD/CAD is at the highs of the day, up 36 pips to 1.3209 after retail sales data. The pair was tracking higher in the hour leading up to the release on broad USD strength and then continued higher after the data showed sales up 0.2% m/m compared to 0.5% expected. In addition, the advance reading for June was flat.
The rise in USD/CAD comes despite a $1.06 climb in WTI crude oil today today $76.79, which would be the highest weekly close since April.
The rates market is pricing in a 75% chance the Bank of Canada holds rates unchanged at the September 6 meeting, up from 70% before the release. Retail sales will be one of the first indicators that show Canadian consumers are feeling the pinch of high rates.
Tecnnically, the weekly high of 1.3240 could come into play today if USD strength continues. If there’s a catalyst for USD gains, it’s likely to be the stock market as heavy options expiries go through today along with a rebalancing of the Nasdaq. In any case, S&P 500 futures are up 20 points ahead of the open.