CANADA FX DEBT-C$ slips lower on retail sales data

Mon Feb 23, 2009 5:11pm EST
 
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* Canadian dollar slightly weaker after early rise

* Canada retail sales drop more than expected

* Bonds higher across the curve

* (Adds details, quote)

By Jennifer Kwan

TORONTO, Feb 23 (Reuters) - The Canadian dollar was slightly lower against the U.S. dollar on Monday, as data showing a big drop in December retail sales reinforced expectations the Bank of Canada will cut interest rates next week.

Retail sales tumbled 5.4 percent in December, Statistics Canada reported on Monday, marking the biggest monthly drop since 1991 and more than twice what was expected. [ID:nN23330217]

"What takes precedence is the dismal retail sales numbers that we got this morning," said Charmaine Buskas, senior economics strategist at TD Securities.

"They definitely confirm that the Canadian economy is under a lot of pressure and it certainly assures the markets that another rate cut is coming from the Bank of Canada," Buskas said.   Continued...