Summary:

  • Canadian inflation and retail sales reports are bound to draw the most attention today
  • US existing home sales worth looking at as well
  • Two central bank speakers scheduled for today and Yellen shortly after midnight

The last day of this week is likely to be dominated by the Canadian dollar at least in terms of macroeconomic reports. The CAD will get two crucial releases concerning inflation and retail sales, both could have a massive impact on the Loonie, this is especially true when we take into account that the BoC meets next week. On top of this, there will be the real estate data from the US and some central bank speakers.

1:30 pm BST – Canadian CPI (September) and retail sales (August): The Bank of Canada has hiked interest rates twice so far this year with the second hike being a toss-up which sparked huge appreciation of the CAD. This time things look similarly as the OIS-implied probability suggests mediocre 20%+ that the BoC will deliver yet another rate increase in 2017. Thus, today’s reports will be obviously exceptionally crucial as they could set the bar ahead of the meeting next week. The consensus points to a 1.7% yoy pick-up when it comes to CPI while retail sales are expected to show 0.5% mom and 0.3% mom for the headline and the core (ex auto) measure respectively. It’s also worth stressing that the USDCAD has already climbed to the levels seen from before the unexpected BoC’s second hike, that could be seen as a factor increasing chances for a hike in the following week. 

3:00 pm BST – US existing home sales: The housing data isn’t in the spotlight however it may be interesting given its vulnerability to changes in market rates. That said, one could expect that both existing home as well as new home sales lowered in the prior month which would be in line with the levels suggesting by the 30Y mortgage rate. Today’s figure is expected to come in at 5.3 million while the last month saw 5.35 million.

Central bank speakers in the upcoming hours:

  • 9:30 am BST – ECB’s Nowotny
  • 7:00 pm BST – FED’s Mester
  • 21.10, 0:30 am BST – FED’s Yellen will give a lecture on monetary policy since the financial crisis

link do file download linkThe USDCAD has respected its important support area in the vicinity of 1.2450 and could be marching towards 1.26. Either way, a bunch of the macroeconomic data could shake the pair. Source: xStation5