Canadian retail sales came in 1% MoM in line with expectations (after -0.8% decline in July) but core sales came in 0.7% MoM well below 1.3% exp. but higher than -1.2% in July. The USDCAD pair fell below 1.4 after the report.
The Canadian retail sales report for August 2025 showed a 1.0% month-over-month increase, reaching CAD 70.4 billion. This marks a solid rebound following July’s decline. Growth was recorded in six of nine sectors, led by motor vehicle and parts dealers, while gasoline stations and fuel retailers reported decreases.
The August report indicates a relatively strong recovery in consumer demand after earlier weakness, suggesting that immediate interest rate cuts by the Bank of Canada (BoC) are unlikely. On the other hand, the preliminary September estimate points to a potential renewed slowdown in sales — if confirmed, it could increase pressure on the BoC to ease monetary policy. Revised September data and upcoming monthly figures will be crucial in assessing the central bank’s stance on rate cuts.
It is also worth noting that inflation in Canada rebounded sharply to 2.4% year over year in September, compared with 1.9% in August. The probability of another BoC rate cut (scheduled on the same day as the Federal Reserve’s decision) currently stands at around 80%. The USDCAD pair remains below the 1.40 level, showing a slight decline after the report. Meanwhile, the strengthening of oil prices suggests that USDCAD could experience a short-term correction toward the 1.3900–1.3950 range.
The material on this page does not constitute financial advice and does not take into account your level of understanding, investment objectives, financial situation or any other specific needs. All information provided, including opinions, market research, mathematical results and technical analyzes published on the Website or transmitted To you by other means, it is provided for information purposes only and should in no way be construed as an offer or solicitation for a transaction in any financial instrument, nor should the information provided be construed as advice of a legal or financial nature on which any investment decisions you make should be based exclusively To your level of understanding, investment objectives, financial situation, or other specific needs, any decision to act on the information published on the Website or sent to you by other means is entirely at your own risk if you In doubt or unsure about your understanding of a particular product, instrument, service or transaction, you should seek professional or legal advice before trading. Investing in CFDs carries a high level of risk, as they are leveraged products and have small movements Often the market can result in much larger movements in the value of your investment, and this can work against you or in your favor. Please ensure you fully understand the risks involved, taking into account investments objectives and level of experience, before trading and, if necessary, seek independent advice.
