Daily Afternoon Report 15.03.2016

The U.S. dollar was higher against its Canadian counterpart on Tuesday, despite the release of disappointing U.S. economic reports, as declining oil prices continued to weigh on the commodity-related Canadian currency.

USD/CAD hit 1.3400 during early U.S. trade, the pair’s highest since March 9; the pair subsequently consolidated at 1.3348, climbing 0.67%.

The pair was likely to find support at 1.3208, Monday’s low, and resistance at 1.3446, the high of March 9.

The U.S. Commerce Department said that retail sales fell 0.1% last month, better than expectations for a decline of 0.2%.

Core retail sales, which exclude automobile sales, declined by 0.1% in February, compared to forecasts for a fall of 0.2%.

A separate report showed that the U.S. producer price index fell 0.2% last month, in line with the forecasts. Year-over-year, producer prices were flat, compared to expectations for a 0.1% increase.

Core PPI, which excludes food and energy, was also flat in February, below forecasts for a gain of 0.1%.

At the same time, the Federal Reserve Bank of New York said that its general business conditions index improved to 0.6 this month from a reading of -16.6 in February. Analysts had expected the index to rise to -10.0 in March.

Meanwhile, the Canadian dollar remained under pressure as oil prices pulled back from three-month highs on Monday after Iranian Oil Minister Bijan Zanganeh said his country won’t join a group production freeze until it doubles its post-sanctions output.

The loonie was lower against the euro, with EUR/CAD advancing 0.69% to 1.4822.