USD/CAD – Canadian Dollar Lower, Manufacturing Sales Next

 | Oct 17, 2018 08:07AM ET

The Canadian dollar has edged lower in the Wednesday session. Currently, USD/CAD is trading at 1.2974, up 0.31% on the day. On the release front, there are key indicators on both sides of the border. Canada releases Manufacturing Sales is expected to decline by 0.6%. In the U.S, the focus is on construction data. Building Permits are expected to rise to 1.28 million, while Housing Starts are forecast to slip to 1.21 million. As well, the Federal Reserve releases the minutes of its September policy meeting. On Thursday, the U.S publishes Philly Fed Manufacturing Index and unemployment claims.

The Canadian dollar gained ground early this week. The currency received a boost from an optimistic Bank of Canada business survey on Monday. The poll found that businesses expect higher sales for both domestic and foreign customers. Companies are reporting increased investment and hiring, and the mood is optimistic in the business sector. Investors are keeping an eye on the BoC, which set the benchmark rate next week. The markets are widely expecting the BoC to raise rates by a quarter-point, which would match the Fed rate hike in September.

U.S indicators were a mixed bag on Monday, as retail sales were soft but manufacturing data was solid. Retail Sales posted a meager gain of 0.1%, shy of the estimate of 0.4%. Core Retail Sales surprised with a decline of 0.1%, compared to an estimate of 0.4%. This marked the first decline since June 2017. There was better news from the manufacturing front, as Empire State Manufacturing Index strengthened to 21.1, above the estimate of 20.4 points.

USD/CAD Fundamentals

Wednesday (October 17)

  • 8:30 Canadian Manufacturing Sales. Estimate 0.6%
  • 8:30 US Building Permits. Estimate 1.28M
  • 8:30 US Housing Starts. Estimate 1.21M
  • 10:30 US Crude Oil Inventories
  • 12:10 US FOMC Member Lael Brainard Speaks

Thursday (October 18)

  • 8:30 Canadian ADP Nonfarm Employment Change
  • 8:30 US Philly Fed Manufacturing Index. Estimate 19.7
  • 8:30 US Unemployment Claims. Estimate 211K

*Key events are in bold

USD/CAD for Wednesday, October 17, 2018