USD/CAD Steadies as Canada Retail Sales Meet 1.0% Forecast

USD/CAD saw limited movement as Canada's May retail sales came in at 1.0%, matching the consensus estimate and marking a significant improvement from the prior month's downwardly revised 0.4% (previously 0.5%). Retail sales ex-autos rose 1.2%, slightly missing the 1.4% forecast, while the prior month was revised down to 0.0% from 0.1%. Sales were up across all nine subsectors, led by gasoline stations and fuel vendors, reflecting the impact of elevated crude oil prices. Core retail sales, excluding gasoline, fuel vendors, and motor vehicle and parts dealers, rose a solid 0.9%, indicating healthy underlying consumer demand. The broad-based gains suggest Canadian consumers remain resilient despite elevated interest rates. For USD/CAD traders, the in-line headline figure limits immediate CAD-bullish momentum, though the strong core reading provides underlying support for the loonie. Traders should monitor upcoming Bank of Canada communications for any shift in rate guidance given this evidence of sustained consumer spending.