- US Existing Home Sales continue to deteriorate and weigh on the USD.
- Retail Sales in Canada fell, but improved in November compared to October.
- The Fed’s Patrick Harker supports a 25 basis point rate hike to the Fed Funds rate.
The pair USD/CAD Posts moderate losses during the North American session, falling from daily highs near 1.3500 after the release of US and Canadian data, reinforcing the Loonie (CAD), which pared some of its weekly losses. As of this writing, the USD/CAD pair stands at 1.3418, below its opening price.
US Existing Home Sales deteriorated while Canadian Retail Sales improved
Wall Street shows an optimistic sentiment. The United States (US) economic calendar reported that December Existing Home Sales fell for the 11th consecutive month. Sales fell 1.5% compared to November.
“December was another difficult month for buyers, who continue to contend with limited inventory and high mortgage rates,” said Lawrence Yun, NAR’s chief economist. “However, sales are expected to pick up soon as mortgage rates have come down sharply after peaking late last year.”
Across the border, Canada’s agenda was reported as retail sales, which fell -0.1%m/m in November, but improved as October data showed a -0.5% sales slump, according to Statistics Canada.
In addition to the economic data release, the USD/CAD was also supported by upbeat sentiment from the markets. The pair dipped below the 20-day EMA at 1.3470 and also dipped below the 100-day EMA at 1.3426. Therefore, the trend of USD/CAD is turning from neutral to bearish.
On the other hand, a number of Fed officials, particularly Philadelphia Fed President Patrick Harker, opened the door for a reduction in interest rate hikes, saying that “25 basis point hikes will be appropriate.” in the future”. Harker expects the US economy to grow 1% and the unemployment rate to go from 3.5% to 4.5%. Later, Kansas City Fed President Esther George said the Federal Reserve must be “patient” to see if inflation in the service sector subsides.
Key USD/CAD Technical Levels
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
