Canadian dollar hits 7-month high after upbeat retail sales data
TORONTO - The Canadian dollar strengthened to a seven-month high against its U.S. counterpart on Friday as the greenback posted broad-based declines and domestic retail sales data supported bets that the Bank of Canada would remain on the sidelines.
The loonie was trading 1% higher at 1.3712 per U.S. dollar, or 72.93 U.S. cents, its strongest intraday level since October 10.
It was the fifth straight day of gains for the currency, the longest daily winning streak since June. For the week, the currency was up 1.8%.
Canadian retail sales grew by 0.8% in March from February, more than analysts had forecast, while preliminary data showed an April increase of 0.5%.
The combination of strong domestic data and reduced demand for the American currency "put a flame under the Canadian dollar today," said Erik Bregar, director, FX & precious metals risk management at Silver Gold Bull.
The move began "snowballing" after USD-CAD triggered stop-loss orders below the May 6 low at 1.3748.
The U.S. dollar tumbled against a basket of major currencies and the price of oil, one of Canada's major exports, gained 0.6% to $61.58 a barrel.
On Tuesday, hotter-than-expected Canadian core-inflation data spurred investors to bet that the BoC would leave its benchmark interest rate unchanged at 2.75% at a policy decision on June 4, after previously expecting the central bank to resume its easing campaign.
The Canadian 10-year yield was down 1.5 basis points at 3.360%, tracking a decline in U.S. Treasury yields.
U.S. President Donald Trump threatened to impose hefty tariffs on smartphone giant Apple and goods from the European Union, raising concerns about slowing economic growth.
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