The Australian dollar and New Zealand dollar both rocketed higher at the start of the US trading session amidst broad declines in the greenback, though these commodity currencies finished the day essentially unchanged from Monday.
Moves in the Canadian dollar were a bit more dramatic, though, as the release of Canadian spending figures proved to be much stronger than expected. Indeed, retail sales jumped 1.1 percent in September, nearly three times as much as economists had forecasted. This is something we noted potential for yesterday, given the solid employment numbers we’ve seen over the past three months and 1.5 percent gain in wholesale sales. While this does bode well for Q3 GDP results, the Bank of Canada is still anticipated to cut rates by 25 basis points during their next meeting on December 9, as the financial crisis and economic slowdown in the US threatens to weigh on growth in Canada as well.
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