2012-02-01 11:44:00

At the Forex currency market the Canadian Dollar rate is traded downward in the middle of the week, due to decline in interest to risk among players. Statistics released yesterday has put additional pressure on the CAD.

Forex forecast: MACD indicator for the pair USD/CAD is sliding down in the negative area and is giving a sell signal. Stochastic Oscillator is growing in the neutral zone and is giving a buy signal.

Forex recommendations: case of breakdown at 1.0030, the pair will go to 1.0050and 1.0070. 

According to the data released yesterday, real GDP in Canada fell by 0.1%m/m (+2.0% y/y) in November against expectations of growth of 0.2% m/m.

Prices for industrial goods fell by 0.7% m/m in December versus preliminary forecast of growth of 0.3%, which has become the biggest

The data released earlier showed that leading indicators index in Canada rose by 0.8% m/m in December against the forecast of +0.6% m/m. Latest statistics showed that CPI in Canada fell by 0.6% m/m (+2.3% y/y) in December against the forecast of -0.1% m/m. Despite this obvious fact, the data requires some clarification. Annual growth of CPI has been minimal since February 2011, and inflation reduced due to decline in prices for gasoline and other fuel.

Therefore, basing on the current inflationary situation, the Bank of Canada can keep inflation at the existing level for some more time with no damage for its monetary policy.

At the same time, according to the forecast of the Bank of Canada, inflation will slow down to +1.5% on annual basis in April-June.

According to the updated estimates of the Bank of Canada, GDP in the country will amount to 3.1% in Q1 2013; inflation will reduce to 1.5% in Q2this year. At the same time, interest rate can go up in the moderate pace during all the year of 2013, while decline in mortgage rates will encourage boost in the volumes of lending to households.

GDP in Canada rose by 3.5% y/y in Q3 against revised decline of 0.5% in April-June. Economists predicted growth of the index of 3%. The data showed that sales increased by 0.2% in the manufacturing sector of Canada against expectations of 1.2%, the main driver of the growth was general rise in the sector and improvement in some of its sections: such as industrial equipment sector, for example. Number of new orders in the sector rose by 3.7% in November, stocks in the warehouses: by 0.4%. 
We would remind that, in the middle of January, the Bank of Canada left interest rate at the level of 1.0% per annum, which did not become a surprise for the market.

CAD: Canadian Dollar retreats due to decline in appetite to risk