Double does of good news for the Canadian dollar
A pair of top-tier economic data releases sent the Canadian dollar higher on Friday, sinking USD/CAD down to 1.3161 from 1.3230.
The main driver was a strong May retail sales report with spending up 2.0% y/y compared to 1.0% expected. Sales in April had surprised economists by falling 1.2% and that raised questions about the consumer but the report may have been skewed by miserable weather and May's strength showed that Canadians were still dipping into their wallets.
Inflation also beat estimates with CPI rising 2.5% compared to 2.3% expected. That's the highest year-over-year pace since 2012.
The selling dipped below yesterday's low in USD/CAD, creating a potential outside reversal. You would like to see 1.3150 break with a close below to confirm it.
