USD/CAD Fundamental Analysis August 14, 2013 Forecast

Analysis and Recommendations:

The USD/CAD is trading at 1.0320 gaining 16 pips ahead of US retail sales due later in the trading day. Market consensus expects sales to have expanded 0.3% on a monthly basis during July and 0.4% stripping the automobile sector. With the relatively decent tone in labor market activity and improvement in financial wealth from rising home and equity prices continuing to underpin household confidence, we expect the tone of this report to be encouraging, pointing to continued positive momentum in household spending.

Canada’s dollar declined for the first time in three days after it failed to breach a key technical level, a move that might have signaled gains beyond a one-week high it reached last week, spurring speculation the currency’s run of strength is at an end. The currency hasn’t closed below its 100-day moving average against its U.S. counterpart, a momentum indicator some traders see as a potential turning point, since July 29. The Loonie slipped as the U.S. dollar climbed against all 16 most-traded peers before data tomorrow that may show American retail sales gained, supporting a slowing of stimulus in Canada’s biggest trade partner. Oil gained today helping to limit the Cad’s fall.

Canada unexpectedly lost jobs in July, with employment dropping by 39,400 positions, the government reported last week. The U.S. dollar gained amid bets the Federal Reserve will slow its $85 billion in monthly bond purchases as soon as next month as the world’s biggest economy improves. Central-bank asset purchases tend to weaken a currency. The Fed has used the program to push borrowing costs lower and spur economic growth.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data August 13, 2013 actual v. forecast

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Government Bond Auction

Date Time Country 

Aug 14 08:30 Spain

Aug 14 09:30 Germany

Aug 15 09:30 UK

Aug 15 11:00 Norway