Canada retail sales for August -0.3% vs 0.5% exp. USD/CAD shoots higher.
August retail sales lower than expectations
The Canada retail sales come in weaker than expected at -0.3% vs 0.5% estimate.
- Ex Auto the number was also weaker at -0.7% vs +0.3% estimate
- The prior month for the headline came in at 0.4% (no revision)
- The Ex auto last month came in at +0.2% (no revision).
- Sales were down in 8 of 11 subsectors, representing 57% of retail trade.
- Lower sales at food and beverage stores more than offset higher sales at gasoline stations and motor vehicle and parts dealers.
- Food and beverages fell -2.5% after 4 consecutive month rises.
- Retail sales were down in six provinces in August. Lower sales in Quebec and British Columbia accounted for the majority of the decline.
The USDCAD has jumped up on the weaker data (lower CAD). The CPI was also a touch weaker than expectations.
The price shot up above the ceiling at the 1.25185 on the data. The 38.2%-50% of the move higher (the pair made new lows just before the data - no leaks there), comes in at 1.25185-299. That is now support on a dip.
Looking at the 4-hour chart, the highs from October at 1.2589 (this week) and 1.25975 are upside targets. The high this month is the highest since August 31st. The 100 day MA is at 1.26716. We are not likely to make it there, but if the momentum keeps up, we could be heading that way. The USDCAD has not traded above that MA since June 12th.