The euro remained range-bound against the loonie yesterday following the release of weak economic data from both the Eurozone and Canada. While Eurozone retail sales declined more than anticipated in September, Canadian building permit data for the same period indicated a steep decline. Overall, the EUR/CAD pair traded in a narrow range of between 1.4696 and 1.4730 in the past 24 hours.
According to the final data published by Destatis, the German consumer price index remained unchanged in October after a 0.30% increase in September, in line with economists’ estimates. The reported figure matched preliminary estimates and was in line with market forecasts.
On a y-o-y basis, the German consumer price index rose by 3.80% in October 2023. The reported figure represents the lowest annual inflation since August 2021. Notably, the annual inflation in September was 4.50%.
Energy product prices fell by 3.20%y-o-y in October. This paved the way for the easing of inflationary pressure. Food prices surged by 6.10% y-o-y in October. The previous low food price inflation of 5.40% was recorded in February 2021.
Devoid of energy prices, the inflation rate was 4.50% in October. Additionally, excluding food and energy prices, the inflation rate was 4.30%.
The prices of goods grew by 3.60% y-o-y in October 2023. Specifically, the prices of non-durable consumer goods increased by 3.50%.
Likewise, the prices of services posted a growth of 3.90% y-o-y in October 2023, almost unchanged compared with September’s rise of 4%.
Eurozone retail sales fell by 0.30 % m-o-m in September, following a decline of 0.70% in August. Economists had anticipated only a 0.20% decrease.
The decline in the volume of retail trade was led by a 1.90% drop in non-food products and a 0.90% decrease in automotive fuels. Food, drinks, and tobacco recorded an increase of 1.40%.
On a y-o-y basis, the Eurozone retail sales, as per Eurostat, fell by 2.90% in September 2023.
Automotive fuels recorded a decline of 7.50%. Likewise, non-food products posted a drop of 3.40%. Food, drinks, and tobacco reported a decrease of 1%.
According to Statistics Canada, the country’s building permits fell by 6.50% m-o-m in September to C$11.20 billion following a 3.40% increase in August and worse than forecasts of a 0.50% decline.
The aggregate monthly value of residential permits rose by 4.30% in September to C$7.20 billion, driven by a 37.20% rise in construction intentions in British Colombia.
The aggregate monthly value of non-residential permits declined by 21% m-o-m in September to C$4 billion. Despite the steep m-o-m drop, the aggregate value of non-residential building permits stood 18.70% higher than the comparable period in 2022.
Furthermore, the aggregate value of building permits grew by 4.90% q-o-q in the September 2023 quarter to C$34.60 billion.
Technically, the EUR/CAD pair is gaining ground after consolidating at 1.4585. The next major resistance is anticipated only near 1.4890. Additionally, the currency pair is trading above its 50-day moving average, while the MACD indicator is showing a positive reading. Therefore, we anticipate the EUR/CAD pair to remain in an uptrend in the near term.
Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.
