Loonie Gains vs. Greenback on Fundamentals, Falls vs. Euro

The Canadian dollar advanced versus the US dollar on the good outlook for today’s Canadian macroeconomic reports, while fell against the euro as promises of resolution of the Greek crisis bolstered Europe’s shared currency.

Analysts estimated, before the report from Statistics Canada, that the Canadian retail sales rose 0.6 percent in April. The core retail sales increased 0.5 percent, following the drop by 0.1 percent in April. The growth of the leading index was estimated to be 0.6 percent in May, following the growth by 0.8 percent in the month before.

Despite talks about resolution of the Greek debt problems, the optimism for the European economy, as well as the global economy, can evaporate very quickly unless some real progress in the battle with credit issues would be evident. The euro’s strength is already waning. The loonie can gain versus the 17-nation currency, but by the same token can weaken versus “safety currencies”, including the greenback.

USD/CAD dropped from 0.9797 to 0.9788 todays as of 2:19 GMT. EUR/CAD traded at about 1.4030 after it jumped from 1.4015 to 1.4065.

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