US PCE May Soar Soon
The United States Bureau of Economic Analysis will release monthly Personal Consumption Expenditures (PCE) on June 30, 15:30 GMT+3.
What Can Happen to the CAD after the Retail Data?
What will happen?
Canada will publish Retail Sales and Core Retail Sales on June 21 at 15:30 GMT+3. The indicator represents the change in the total value of sales at the retail level. Apart from the headline Retail Sales, the Core indicator does not include automobile sales due to their volatility.
Why is it important?
Economists track the differences in releases of Retail Sales and Core Retail Sales month-by-month, as it helps to see the level of consumer spending. If the indicators rise, consumers spend more, economic activity expands, and inflation increases. As a result, the central bank starts considering monetary policy tightening. This is a bullish signal for the currency.
Last time, the data was mixed. The headline indicator did not show any changes (0% vs. 1.5% expected), while Core Retail Sales increased by 2.4% (vs. the forecast of 2.2%). You can see the candlestick with the small body on the chart of USDCAD after the release. The figures from Canada were overshadowed by the weak US preliminary GDP, which fell 1.5% vs. the forecast of -1.3%. As a result, the Canadian dollar strengthened after the statistics were published. If you traded one lot of USDCAD on May 26, you could have earned more than $400.
How to trade on the Canadian Retail Data?
Wait for the actual figures to appear in the economic calendar and compare them with the forecasted ones.
- If Retail Sales and Core Retail Sales are higher than the forecasted, the CAD will rise.
- If Retail Sales and Core Retail Sales are lower than the forecasted, the CAD will fall.
Instruments to trade: USDCAD, CADJPY, CADCHF
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