By Commodity News Service Canada
Winnipeg, August 22 – The Canadian dollar saw little change on Friday amid a stronger than expected showing on retail sales and tame inflation data, analysts said.
At 9:15 CDT Friday morning, the loonie was 0.01 of a cent lower to US$0.9136 or US$1 = C$1.0948 as Statistics Canada reported that the consumer price index declined 0.2 per cent in July, in comparison with the 0.1 per cent decrease that economists had expected. This translated to an annualized inflation rate of 2.1 per cent in July, which was weaker than the 2.2 per cent reading that was forecast. The rate was also down from the 2.4 per cent in the previous month.
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Retail sales for June jumped 1.1 per cent over sales in May, much higher than the consensus estimate of a 0.3 per cent advance.
Markets were generally cautious amid a deterioration in the Russia and Ukraine crisis while traders also looked to the keynote speech from U.S. Federal Reserve Chairwoman Janet Yellen, scheduled for later this morning at the central bank’s economic symposium in Jackson Hole, Wyoming.
Yellen is expected to focus on the labour market in her speech, as the condition of the labour market will be critical for when the Fed decides to hike interest rates, which have been held near zero since the financial crisis. Traders are generally expecting that the Fed will hike interest rates in mid-2015, but there are concerns that it could happen sooner.
Also highly-anticipated is an afternoon speech by European Central Bank chairman Mario Draghi. Growth in the eurozone has slowed dramatically and his audience will want to hear about any indication that the ECB plans on further stimulus measures, such as quantitative easing.
At 9:15 CDT Friday morning, the Toronto Stock Exchange was 27.91 points lower at 15,527.35.
