Canadian Dollar Little Changed after Upbeat Wholesale Sales Report

The Canadian dollar was relatively unchanged in the early North American session as investors digested upbeat Canadian wholesale sales data and awaited latest US home sales figures.

Canadian wholesale sales increased 1.1 percent in February, following a gain of 0.5 percent the previous month, Statistics Canada reported today in Ottawa. Economists forecast a gain of 0.7 percent. Excluding motor vehicles and parts, wholesale sales rose 0.8 percent.

The National Association of Realtors will report on previously-owned home sales later in the day. The monthly reading is used to gauge current trends in the housing market. The US housing sector continues to struggle, according to latest groundbreaking and building permits data courtesy of the Commerce Department. The housing market has cooled over the past half year as rising mortgage rates have weighed on buying activity.

The Canadian dollar was trading at 0.9087 US, up 6 pips from the previous open. The loonie rebounded from an intraday low of 0.9070, after having failed to generate any headway over the previous five sessions. Compared to a month ago, the Canadian dollar has gained 2 percent against its US rival.

Market sentiment toward the loonie is mixed. On the one hand the Canadian currency has benefited from stronger fundamentals at home. On the other hand, the Bank of Canada could be trying to “talk down” the loonie in order to kickstart exports and equalise labour costs across borders.

Statistics Canada is scheduled to report on retail sales Wednesday. The monthly report could show retail sales jumped 0.4 percent in February after a gain of 1.3 percent the previous month.