Canadian dollar is gaining ground right now, thanks to economic data that is better than expected in the United States. Forex traders have been looking for signs that the global economic situation is improving, and the latest news is helping in that area.
The United States showed that retail sales for September gained by 1.1 per cent. On top of that, August retail sales were revised upward to 1.2 per cent. As one of the major trading partners for Canada, an improvement in the US economy is likely to help the loonie. Plus, the situation results in a “risk on” scenario that helps high beta currencies like the Canadian dollar.
Another good sign for the global economy is the fact that China’s inflation, while continuing to slow, is doing so at a lower rate. The latest news, showing that consumer prices rose 1.9 per cent in China, indicate that China’s slowing might be coming to a bottom. Once that happens, the global economy can look for a little help from the emerging market.
Riskier assets are gaining the upper hand right now, and that includes the Canadian dollar. Loonie is gaining ground as optimism makes an appearance on the currency market.
At 13:22 GMT USD/CAD is down to 0.9785 from the open at 0.9788. GBP/CAD is also lower, down to 1.5715 from the open at 1.5739.
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