Oil prices kept the Loonie above water last week. Which catalysts can influence the comdoll this time?
Retail sales (May 22, 1:30 pm GMT)
Retail activity edged 0.8% higher in February, faster than the 0.4% gain seen in January and the 0.4% uptick that analysts had expected. Aside from following three months of decreases, last month’s release also represented the biggest growth since May 2018. Wowza!
Unfortunately for the bulls, Canada’s strong release was upstaged by Uncle Sam’s own retail trade reports. It also didn’t help that traders were about to go on a long Easter holiday at the time.
This week analysts expect to see the headline retail sales maintain its 0.8% growth. Meanwhile, the core figure, which excludes volatile items such as auto sales, is expected to show a 0.8% increase after last February’s 0.6% uptick.
Take note that the FOMC’s meeting minutes will be published a few hours after Canada’s retail sales. That means y’all gotta watch your Loonie trades in case they see intraday reversals!
Crude oil price movementsAs we’ve seen in last week’s price movements, oil prices can make or break the Loonie’s intraweek trends.
The Black Crack had had a good week last week when traders priced in geopolitical concerns. Specifically, they considered escalated tensions between the U.S. and Iran when the former accused the latter of attacking Saudi Arabian oil tankers and sent an aircraft carrier to the Middle East to protect “American interests in Iraq.”
And then there’s Trump’s tweet, which threatened “the official end of Iran” should the country want to “fight.”
If Iran wants to fight, that will be the official end of Iran. Never threaten the United States again!
— Donald J. Trump (@realDonaldTrump) May 19, 2019
Will geopolitical concerns continue to push oil prices higher? Or will fundamentals dominate prices again? With Russia hinting at possibly relaxing supply restraints as early as next month, it’s only a matter of time before traders go back to pricing in crude oil’s oversupply situation.
Missed last week’s price action? Read CAD’s price recap for (May 13 – 17)!