The USD/JPY currency pair has broken above the 155 level, a fresh high since 1990. The move was aided by comments from an LDP official indicating no immediate plans for intervention. The Canadian dollar also gained ground against the US dollar following a weaker retail sales report, reaching 1.3725. However, a late-day decline in the US dollar helped the pound and euro recover.
Canadians are becoming more cautious about spending as their mortgages come up for renewal at significantly higher interest rates. Retail sales declined by 0.1% in January, below the anticipated increase of 0.1%. Excluding automobiles, sales fell by 0.3%. The rapid growth of Canada’s population continues to inflate the numbers, with total sales still 2.2% lower than a year ago. Warm early-year weather may have also contributed to the sales, according to CIBC. The market currently anticipates a 49% likelihood of an interest rate reduction in June, indicating a close decision.
Canadian retail sales declined by 0.1% in February and remained unchanged in March, indicating a sluggish economic recovery amid rising interest rates. The disappointing retail data has increased market expectations for a potential interest rate cut by the Bank of Canada in June, though the central bank has more economic data to consider before making a decision.
Swedish automaker Volvo Cars has reported an 8% increase in core operating profits for the first quarter of 2024, attributed to strong retail sales. Despite a slight dip in revenue, retail sales surged by 12%, reaching a record high in March. The company’s strong performance in the first quarter sets a positive foundation for the upcoming year.
