Canadian Dollar Steadies as Wholesale Trade Exceeds Forecasts

The Canadian dollar traded within a tight range against its US counterpart on Monday, following a week that was void of any big events. The Canadian currency was supported by wholesale trade growth data today, but it failed to gain any steady momentum.

Statistics Canada released its report for wholesale trade at 13:30 GMT today. The report said that Canadian wholesale sales index gained 0.7% to $57.3 billion in December 2016, marking the third consecutive month of gains. The increase compares analysts’ expectations that averaged a 0.4% gain. The report added that wholesale volume increased 0.9%.

Six subsectors on the index reported stronger wholesales in the last month of 2016, as only the motor vehicle and parts subsector reported a decline. The wholesale sales of the machinery and equipment subsector rose by 2.5%, while the building supplies subsector reported 1.4% higher wholesale sales, marking the top two performing subsectors.

The Canadian economy appears to be moving in line with the economy of the United States, Canada’s largest trade partner. The US economic growth has been displaying signs of health and stability, which is reflected by recent economic releases. However, fears of possible upcoming changes to the North American Free Trade Agreement under Donald Trump’s administration are weighing the Canadian dollar down.

USD/CAD traded at 1.3099 as of 20:45 GMT on Monday, from 1.3078 at 07:15 GMT, the pair’s lowest level today. USD/CAD started the week at 1.3097.

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