For the week of October 17 to 21
Retail sales data for September that grew by the most in three months bolstered the case further for an interest rate hike by the Fed this year. However, in a speech given by Fed Chair Janet Yellen on Friday, mention was made of the plausible benefits of “running the economy hot” which would suggest leaving interest rates low for a time. Investors were disappointed by a lack of hints in this speech toward timing of interest rates hikes or the state of the economy following the release of Fed meeting minutes that showed arguments both for and against raising interest rates.
The price of oil fought between gains and losses on Friday as investors digested conflicting information. On one hand, markets were still contemplating the benefit that may be seen with Russia’s cooperation in the proposed OPEC production cut. On the other hand, data released by the Energy Information Administration showed crude inventories in the United States increasing for the first time since August of this year. At the end of the day, the price of oil closed down by 0.18 percent. This morning, prices are up by a modest 0.18 percent.
Data out of Canada this week will focus around manufacturing sales on Tuesday and consumer prices on Friday. Manufacturing sales are expected to have grown by 0.2 percent after growing by half that amount in July. Headline consumer prices are expected to increase by 0.2 percent while core consumer prices likely grew by 1.8 percent on a year-over-year basis. The Bank of Canada will be revealing their policy decision on Thursday but no changes are expected. In the United States, data will be released for empire manufacturing, industrial production, consumer prices, and housing starts.
The Canadian dollar is trading nearly flat against the U.S. dollar this morning. Today’s expected range is 1.3084 – 1.3184.
Posted by Concentra Financial Markets