For the week of December 14 to 18
It will be another quiet day throughout Canada with only a couple economic releases on the schedule. The Teranet/National Bank Home Price Index is expected to post a gain of 5.5% for the month of November, following a gain of 5.6% in the previous update. On a month-over-month basis, the HPI is forecast to fall by 0.2%. Later this morning the Bloomberg Nanos Confidence Index will update for the week ending December 11. The Index is currently sitting at 56.2, its lowest level since early October. It is also expected to be quiet throughout the United States without any data on the schedule.
Focus throughout Canada this week falls on updates to Manufacturing Sales for October and the November CPI data. Manufacturing Sales are expected to fall by 0.5% after posting a drop of 1.5% in the most recent release. The CPI is forecast to increase slightly by 0.1% on a month-over-month basis in November and 1.5% on a year-over-year basis, still well below the Bank of Canada’s target of 2.0%. Focus in the U.S. will fall on the December 16 Federal Reserve announcement where it is still forecast by a majority of the economists to see the upper bound of the rate move to 0.50% from 0.25%.
In the currency markets, the Canadian dollar is slightly weaker against its U.S. counterpart in early trading this morning. The price of oil continues to struggle, falling over 90 cents to $34.68 per barrel in trading this morning. The key risk to the CAD this week will fall on the update to domestic CPI as well as the Federal Reserve announcement. With the U.S. showing consistent economic strength it is expected to see the CAD continue to struggle against the USD in the New Year.
Todays expected range: 1.3722 – 1.3822
Posted by Concentra Financial Markets