TheÂ Canadian dollar is continuing its tear onÂ Tuesday asÂ theÂ loonie was lifted against major currency rivals onÂ strong automobile sales. TheÂ dollarâs gains were capped byÂ disappointing manufacturing numbers, which could signal aÂ cooling economy. Investors will now look ahead toÂ inflation andÂ retail receipts this week.
According toÂ Statistics Canada, new motor vehicle sales surged toÂ 124,058 units inÂ February, up from 111,917 units inÂ January. This beats theÂ market forecast ofÂ 116,000. TheÂ last time car sales eclipsed theÂ 200,000-mark was inÂ June 2018.
The stats agency also reported that manufacturing sales slipped 0.2% in February to $56.6 billion. The sector was ostensibly affected by motor vehicle assembly and wood products industries sliding 4.4% and 5.9%, respectively. Economists did not anticipate any change for February. When you exclude car sales from the equation, then manufacturing sales were up 0.2%.
OnÂ theÂ data front, investors will look ahead toÂ theÂ inflation rate onÂ Wednesday andÂ retail sales onÂ Thursday.
Business confidence is atÂ its lowest level inÂ three years, says aÂ new Bank ofÂ Canada (BOC) study. TheÂ central bankâs first-quarter survey ofÂ executives found lower projections forÂ sales, asÂ well asÂ aÂ steep drop inÂ theÂ number ofÂ businesses reporting labor shortages. TheÂ BOCâs composite measurement ofÂ sentiment turned negative andÂ slumped toÂ its worst point since 2016.
TheÂ BOC cited aÂ slowing global economy andÂ growing trade tensions forÂ sliding private sector confidence.
TheÂ main headwinds are aÂ more uncertain outlook inÂ theÂ Western Canadian energy sector, continued weakness inÂ housing-related activity inÂ some regions, andÂ tangible impacts from global trade tensions.
BOC Governor Stephen Poloz takes aÂ lot ofÂ stock into theÂ survey, using it asÂ aÂ gauge forÂ policy decisions moving forward. TheÂ report will likely be caused atÂ theÂ next policy meeting onÂ April 24, where it is widely expected that theÂ Ottawa-based central bank will not raise interest rates.
InÂ energy markets, May West Texas Intermediate (WTI) crude oil futures rose $0.22, orÂ 0.35%, toÂ $63.63 per barrel onÂ theÂ New York Mercantile Exchange. Oil remains one ofÂ Canadaâs biggest exports, so theÂ countryâs economy is sensitive toÂ price swings.
TheÂ USD/CAD currency pair decreased 0.11% toÂ 1.3353, from anÂ opening ofÂ 1.3369, atÂ 16:10 GMT onÂ Tuesday. TheÂ EUR/CAD plunged 0.26% toÂ 1.5071, from anÂ opening ofÂ 1.5111.
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