USD/CAD Fundamental Analysis April 16, 2012, Forecast

By FXEmpire.com

Analysis and Recommendations:

The USD/CAD is trading at 0.9975 midsessions. The greenback has gained strength against most of its trading partners all day, on fairly negative data from China, increased worries in the EU and a drop in the price of oil.

The most important near-term driver is the Bank of Canada meeting on Tuesday April 17th. Data continues to be uneven (strong employment, solid housing starts but weak international merchandise trade), but is generally supportive of an underlying economy that is growing.

Canada’s southern neighbors produced some lackluster data today.

The cost of living rose again in March even as the price of gasoline leveled off, the U.S. government reported Friday.

The consumer price index climbed 0.3% last month as the cost of most goods and services rose, the Labor Department said. The increase outstripped the rise in wages, so inflation-adjusted earnings for the average American worker fell 0.1% last month.

Economists expected a 0.2% increase in the cost of living.

Consumer sentiment defies economists’ expectations in early April, easing on worries about current conditions, according to the University of Michigan/Thomson Reuters.

But the overall money flow has been pushing the USD upwards as investors moved to safety. Equities tumbled along with commodities.

Economic Reports for April 13, 2012 actual v. forecast

JPY	Monetary Policy Meeting Minutes
CNY	Chinese Fixed Asset Investment (YoY)	20.9%	20.8%	21.5%
CNY	Chinese GDP (YoY)	8.1%	8.3%	8.9%
CNY	Chinese Industrial Production (YoY)	11.9%	11.5%	11.4%
CNY	Chinese Retail Sales (YoY)	15.2%	15.0%	14.7%
EUR	German CPI (MoM)	0.3%	0.3%	0.3%
EUR	Finnish CPI (YoY)	2.90%	3.10%
GBP	PPI Input (MoM)	1.9%	1.2%	2.5%
USD	Core CPI (MoM)	0.2%	0.2%	0.1%
USD	CPI (MoM)	0.3%	0.3%	0.4%

Economic Events for April 16, 2012

08:15 CHF PPI (MoM) 0.5% 0.8%

The Producer Price Index (PPI) measures the change in the price of goods sold by manufacturers. It is a leading indicator of consumer price inflation, which accounts for the majority of overall inflation.

13:30 USD Core Retail Sales (MoM) 0.6% 0.9%

Core Retail Sales measures the change in the total value of sales at the retail level in the U.S., excluding automobiles. It is an important indicator of consumer spending and is also considered as a pace indicator for the U.S. economy.

13:30 CAD Foreign Securities Purchases -4.19B

Foreign Securities Purchases measures the overall value of domestic stocks, bonds, and money-market assets purchased by foreign investors.

13:30 USD Retail Sales (MoM) 0.4% 1.1%

Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.

13:30 USD NY Empire State Manufacturing Index 21.1 20.2

The Empire State Manufacturing Index rates the relative level of general business conditions New York state. A level above 0.0 indicates improving conditions, below indicates worsening

Government Bond Auctions (this week)

Apr 16-30 n/a UK Re-opened 3.75% 2052 Conventional Gilt syndication

Apr 16 09:10 Slovakia Auctions floating rate Nov 2016 & 4.35% Oct 2025 & Bonds

Apr 16 09:10 Norway T-bill auction

Apr 17 08:30 Spain 12 & 18M T-bill auction

Apr 17 09:30 Belgium Auctions 3 & 12M T-bills

Apr 18 09:10 Sweden Nominal bond auction

Apr 18 09:30 Germany Eur 5.0bn 0.25% Mar 2014 Schatz

Apr 18 14:30 Sweden Details T-bill auction on Apr 25

Apr 19 08:30 Spain Obligacion auction

Apr 19 08:50 France BTAN auction

Apr 19 09:30 UK Auctions 0.125% I/L Gilt 2029

Apr 19 09:50 France OATi auction

Originally posted here