CAD Weekly Forecast (Feb. 17 – 21)

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Canada is set to print its retail sales and CPI numbers this week! What can you expect from the events?

CPI (Feb 19, 1:30 pm GMT)

  • Headline consumer prices stagnated in December, an improvement from November’s 0.1% decline
  • CAD would’ve strengthened at the news if not for the BOC’s dovish statement at the time
  • Markets expect headline CPI at 0.3%, while annualized prices is seen at 2.4% (from 2.2%)

Retail sales (Feb 21, 1:30 pm GMT)

  • Retail trading rose by 0.9% in November after a 1.1% decline in October
  • The report caused an intraday pop for CAD though not as big as other catalysts
  • Analysts see headline retail sales slow down to 0.2% in December
  • Core retail sales could improve from 0.2% to 0.3% for the month

Risk sentiment

  • Coronavirus and its impact on trading and travel (and therefore oil demand) can continue to affect CAD’s price action
  • Watch out for updates on what OPEC and friends are planning once the output cut deal ends at the end of March
  • Calendar events like PMI reports and central bank meeting minutes can also affect demand for the high-yielding comdoll

Technical snapshot

  • Stochastic considers CAD as “overbought” against JPY, CHF, and EUR

  • CAD has gained the most against NZD, EUR, and AUD and has lost the most pips against GBP, JPY, and USD in the last 30 days

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