USD\/CAD Resistance Limits Gains Pre-Canadian Retail Sales Data<\/b><\/p>\n
The risk-sensitive Australian Dollar edged higher in the Asian session, whilst the safe haven US Dollar and Japanese Yen lost ground.<\/span><\/p>\n Japan\u2019s Nikkei 225 advanced, even as Japanese core inflation declined -0.4% August compared to a year earlier. Australia\u2019s ASX 200 dropped -0.1%.<\/span><\/p>\n Gold and silver picked up as US 10-year Treasury yields traded flat.<\/span><\/p>\n Canadian retail sales for July and the preliminary US consumer confidence print for September will be in focus later today.<\/span><\/p>\n Inaction from the Bank of Canada to Support CAD<\/b><\/p>\n Canadian retail sales data for July may fuel the USD \/CAD selloff from the monthly high,. A better-than-forecast print would support the Bank of Canada\u2019s (BoC) view that the Canadian economy is recovering post lockdown more quickly that initially expected, potentially justifying the BoC\u2019s decision to stick with the status quo.<\/span><\/p>\n The BoC voted to keep rates on hold at the lower\u00a0 bound of 0.25%\u201d. The central bank also said it would buy\u00a0 at least $5 billion per week Canadian government bond\u201d at its September meeting.<\/span><\/p>\n The BoC committed to provide the monetary policy stimulus necessity to support the economy and achieve the inflation objective. Given that inflation is at 0.1% the more, the rationale for additional stimulus exists<\/span><\/p>\n BoC Governor Tiff Macklem\u2019s made the point that \u201cwith food inflation elevated at 3%, most don\u2019t feel that inflation is falling\u201d at the Federal Reserve\u2019s Jackson Hole symposium. This could point to Canadian policymakers increasingly considering rolling back some of the BOC\u2019s existing settings if economic data continues to beat..<\/span><\/p>\n As lockdown measures ease, economic growth is likely to pick up. The Canadian economy could outperform that of the US in the short term if Canada contains a second wave of covid. if Canada is able to successfully suppress a fresh \u2018second wave\u2019 of coronavirus infections.<\/span><\/p>\n Average daily cases are double the levels seen in July\u00a0 prompting Chief Public Health Officer Theresa Tam to warn the situation could change and they could lose control of the virus\u2019 spread very quickly.<\/span><\/p>\n That said, the death toll remains low in single figures, which coud suggest that tightening of lockdown measures is relatively unlikely.<\/span><\/p>\n <\/p>\n USD\/CAD could move to fresh month lows if upcoming economic data encourages Canadian policymakers to retain their wait-and-see approach.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":" USD\/CAD Resistance Limits Gains Pre-Canadian Retail Sales Data The risk-sensitive Australian Dollar edged higher in the Asian session, whilst the safe haven US Dollar and Japanese Yen lost ground. Japan\u2019s Nikkei 225 advanced, even as Japanese core inflation declined -0.4% August compared to a year earlier. Australia\u2019s ASX 200 dropped -0.1%. Gold and silver picked […]<\/p>\n","protected":false},"author":163946597,"featured_media":98360,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1694,1381],"tags":[1680,1398,1869],"class_list":{"0":"post-104979","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-cad","8":"category-usd","9":"tag-cad","10":"tag-usd","11":"tag-usd-cad"},"acf":[],"yoast_head":"\n