CAD Wholesale Sales (Jan) Actual -0.6%, Expected 1.3%, Previous -4.2%
Release Explanation: Measures the total value of sales at the wholesale level. “A rising trend has a positive effect on the nation's currency because increased sales at the wholesale level are a good
indication that there is high consumer demand at the retail level”, TheLFB-Forex.com Trade Team said
Trade Desk Thoughts: According to Statistics Canada, wholesale sales declined 0.6% to $41. billion in current dollars in February. Declining sales in the machinery and equipment trade group and the other products sector were major factors contributing to this decrease. In terms of the volume of sales, wholesale sales were flat.
In February, four out of seven sectors, accounting for over two-thirds of total wholesale sales, posted declines. The machinery and electronic equipment sector declined 1.6%, largely as a result of lower sales in the machinery and equipment trade group (-5.2%), which accounts for close to half of the sales in this sector. Within this trade group, declines were observed in industrial as well as in mining, oil and gas well machinery and equipment wholesalers.
Sales in the other products sector fell 4.0% to $5.3 billion in February, offsetting a 4.0% rise in January. The main contributors were declines in all other wholesalers and agricultural chemical and other farm supplies. This was the lowest level in this sector since August 2007. Declines were also seen in the food and beverages sector (-1.0%) and the building materials sector (-0.9%).
The largest increase came in the automotive products sector, which rose 4.0% in February, following a 21.8% decline in January. Sales of motor vehicles increased 9.4%, offsetting some of the losses in January. Sales in motor vehicle parts and accessories fell 7.6% in February, its largest drop since April 2003.
Forex Technical Reaction: The cad (USD/CAD) has moved slightly lower since the release but movement is limited due to the Bank of Canada releasing its interest rate decision at 09:00 EDT. Currently the pair is trading 10 pips higher than the Asian session opening price, just below the 1.2400 level