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The USD/CAD exchange rate saw volatility on Thursday due to mixed US PMI data and Canada’s retail sales statistics. The pair moved towards the lower end of the range early on Thursday as investors prepared for the US Purchasing Managers Index (PMI) data of the day. The pair is trading at 1.3489 as of this writing.
Mixed results caused markets to lose confidence, and the pair gained a lot of ground before closing almost flat for the day. The retail sales figures for Canada also produced inconsistent results, with sales volumes that did not include automobiles falling short of market expectations.
Canadian retail sales increased by 0.9% in December compared to the prediction of 0.8%. While it missed the 0.7% expectation, Canadian retail sales excluding autos increased by a more moderate 0.6%, recovering from the prior -0.4%.
US Initial Jobless Claims for the week ended February 16 declined to 201K, coming in well below the 4-week average of 215.25K and even further away from the forecast of 218K.
The S&P Global PMIs for February in the US were mixed, with Services underperforming but the Manufacturing sector gaining further ground as producers look hopeful they will avoid a recession. The Services component printed at 51.3 MoM versus the forecast 52.0, falling back from the previous month’s 52.5, while the Manufacturing component rose to 51.5 compared to the forecast 50.5 and January’s 50.7.
US Existing Home Sales also rose in January with Existing Home Sales Change climbing 3.1% MoM, recovering from the previous -0.8% (revised up from -1.0%). The Canadian Dollar was the strongest against the Swiss Franc.
Early on Thursday, the USD/CAD fell again into a strong buying zone, sitting at 1.3440 before making a comeback. In the short term, the pair knocked back into 1.3510 while it is still tightly tied to the 1.3500 handle.
