Canadian Retail Sales Overview
Statistics Canada is scheduled to publish the monthly Retail Sales figures for April later this Tuesday at 12:30 GMT. The headline sales are estimated to rise by 0.8% during the reported month as against the flat reading reported in March. Excluding autos, core retail sales probably climbed by 0.6% in April, marking a sharp deceleration from the 2.4% increase in the previous month.
How Could it Affect USD/CAD?
Ahead of the key release, an uptick in crude oil prices underpinned the commodity-linked loonie and dragged the USD/CAD pair lower for the second successive day amid broad-based US dollar weakness. Spot prices dropped to a three-day low, though managed to find decent support near the 1.2900 round-figure mark. Stronger domestic data would be enough to provide a fresh lift to the Canadian dollar and pave the way for an extension of the pair's recent pullback from the YTD peak, around the 1.3080 region touched last Friday.
Conversely, a softer reading could allow the major to gain some traction. That said, any immediate market reaction is more likely to remain limited as the focus remains on the latest Canadian consumer inflation figures, due for release on Wednesday. Traders might also prefer to wait on the sidelines ahead of Fed Chair Jerome Powell's testimony on Wednesday and Thursday. Nevertheless, a big divergence from consensus estimates might still infuse some volatility around the USD/CAD pair and allow traders to grab short-term opportunities.
Key Notes
• USD/CAD ends the bullish correction
• USD/CAD Weekly Forecast: US dollar stars at the Fed after party
• USD/CAD drops to 1.2900 neighbourhood amid rising oil prices, softer USD
About Canadian Retail Sales
The Retail Sales released by the Statistics Canada is a monthly data that shows all goods sold by retailers based on a sampling of retail stores of different types and sizes. The retail sales index is often taken as an indicator of consumer confidence. It shows the performance of the retail sector in the short term. Generally speaking, the positive economic growth anticipates bullish movements for the CAD.
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