By CountingPips.com
The Canadian dollar has been on the defensive today in forex trading action as data released showed that Canadian retail sales decreased unexpectedly in the month of January. Retail sales declined by 0.3 percent to C$37.1 billion in January following a 0.2 percent decrease in December, according to the monthly report released by Statistics Canada today.
The fall in retail sales was unexpected as economic forecasts were looking for a 1.0 percent increase for the month.
Core retail sales, excluding automobile sales, were unchanged in January following an increase by 0.6 percent in December. The flat reading in core sales was below
Contributing to the slide in the retail sales numbers was a decrease in motor vehicle sales and parts dealers by 1.5 percent in January. Gasoline station sales also had a declining month with a decrease of 1.4 percent while furniture and home furnishing sales fell by 2.3 percent in January.
Positively contributing to the monthly retail sales report was an increase at food and beverage stores by 0.7 percent while general merchandise store sales increased by 1.2 percent for the month.
Canada’s Leading Indicators rise in February.
A separate data release from Statistics Canada showed that the Leading Indicators index rose by more than expected for the month of February. The Leading Indicator Index, which measures future economic activity, advanced by 0.8 percent in February following an increase of 0.4 percent in January. Market forecasters were looking for a 0.7 percent advancement on the month.
Boosting the leading indicator index was an increase in stock market index by 2.7 percent while the housing index indicator rose by 1.8 percent. The new orders for durable goods indicator advanced by 1.0 percent and furniture and appliance sales gained by 0.9 percent.
Nine out of the ten components that make up the leading indicator index had increasing levels in February. On the downside, the business and personal services employment index declined by 0.2 percent in February.
Canadian dollar on defensive vs major forex currencies
The Canadian dollar has been trading lower today in the currency markets against the other major currencies. The Canadian dollar also known as the “loonie”, has lost ground verses the U.S. dollar, British pound sterling, Japanese yen, Australian dollar and the New Zealand dollar while trading virtually unchanged against the euro, according to currency data from Oanda in the US session afternoon.