Canada expands in January
Data this morning showed that the Canadian economy expanded in January, beating market expectations and fully offsetting the reported declines that were posted in November and December.
According to Stats Canada, Canada’s GDP increased +0.3% in January from the previous month to a seasonally adjusted C$1.95T. Market expectations were looking for a headline gain of +0.1%.
Canadian producer prices rose In February
Stats Canada also said that Canadian producer prices rose in February, mainly due to higher prices for energy and petroleum products.
Canada’s industrial product price index rose +0.3% in February, following the -0.3% decline in January. On a 12-month basis, the producer-price index was up +1.2%.
Note: The index measures the price manufacturers in Canada receive, it does reflect the final prices consumers pay for goods.
As for raw materials, prices paid by manufacturers in February rose +4.6%, following a revised +4.0% gain in the previous month. February’s increase was mostly because of higher prices for crude energy products. On a 12-month basis, prices for raw materials are down -0.6%.
Loonie takes off
Canada’s GDP headline print handily beat market expectations and with WTI back trading above the psychological $60 handle, is providing support for CAD.
Loonie bull’s brought CAD on the release which has taken USD ‘bulls’ by surprise. CAD is +0.65% higher at C$1.3346. Strong support for the USD appears around C$1.3325-30. Expect those long USD positions that have been caught off side to be a willing USD seller on upticks.
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Dean Popplewell
He has a deep understanding of market fundamentals and the impact of global events on capital markets.
He is respected among professional traders for his skilled analysis and career history as global head
of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean
has played an instrumental role in driving awareness of the forex market as an emerging asset class
for retail investors, as well as providing expert counsel to a number of internal teams on how to best
serve clients and industry stakeholders.
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