USD/CAD climbs above 1.3900 as US Dollar bounces back, Canadian job data falters

Source Fxstreet
  • USD/CAD rises sharply above 1.3900 on multiple tailwinds.
  • The Canadian Dollar weakens as job demand remained slow in October.
  • The US Dollar rebounds strongly on Trump’s policy outlook.

The USD/CAD pair jumps above the key resistance of 1.3900 in Friday’s North American session. The Loonie asset strengthens as the Canadian labor addition data for October came in weaker than expected and the US Dollar (USD) bounces back strongly.

The Canadian employment report showed that the economy added 14.5K workers, lower than estimates of 25K and from 46.7K in September. The Unemployment Rate remained steady at 6.5%, which was expected to accelerate to 6.6%.

Slower job demand solidifies expectations that the Bank of Canada (BoC) could deliver another large interest rate cut in its last monetary policy meeting of this year in December. In the October meeting, the BoC reduced its key borrowing rates by 50 basis points (bps) to 3.75%.

Meanwhile, Average Hourly Wages accelerated to 4.9% compared to the similar month of the preceding year against 4.5% in September. Higher wage growth is less-likely to impact the BoC’s policy guidance with policymakers remaining confident about inflation staying within the tolerance.

The US Dollar Inde (DXY), which gauges Greenback’s value against six major currencies, extends its recovery to near 104.80. The outlook of the US Dollar remains firm as investors expect that Donald’ Trump’s protectionist policies would keep it competitive against other currencies. Trump vowed to hike import tariffs by 10% and lower corporate taxes in election campaigns.

Economic Indicator

Net Change in Employment

The Net Change in Employment released by Statistics Canada is a measure of the change in the number of people in employment in Canada. Generally speaking, a rise in this indicator has positive implications for consumer spending and indicates economic growth. Therefore, a high reading is seen as bullish for the Canadian Dollar (CAD), while a low reading is seen as bearish.

Read more.

Last release: Fri Nov 08, 2024 13:30

Frequency: Monthly

Actual: 14.5K

Consensus: 25K

Previous: 46.7K

Source: Statistics Canada

Canada’s labor market statistics tend to have a significant impact on the Canadian dollar, with the Employment Change figure carrying most of the weight. There is a significant correlation between the amount of people working and consumption, which impacts inflation and the Bank of Canada’s rate decisions, in turn moving the C$. Actual figures beating consensus tend to be CAD bullish, with currency markets usually reacting steadily and consistently in response to the publication.

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Finding The Best Japan Stocks to Buy? These are Top Japanese Companies to Watch Discover the best Japanese stocks to buy, including AI semiconductor leaders, Buffett-backed trading houses, and undervalued Japan stocks benefiting from corporate reforms and yen trends.
Author  Mitrade
May 29, Fri
Discover the best Japanese stocks to buy, including AI semiconductor leaders, Buffett-backed trading houses, and undervalued Japan stocks benefiting from corporate reforms and yen trends.
placeholder
WTI rises to near $93.00 as Iran launches missiles toward Kuwait, BahrainWest Texas Intermediate (WTI) gains ground for the third successive day, trading around $92.90 per barrel during the Asian hours on Wednesday.
Author  FXStreet
Jun 03, Wed
West Texas Intermediate (WTI) gains ground for the third successive day, trading around $92.90 per barrel during the Asian hours on Wednesday.
placeholder
Forex Today: US Dollar stays resilient ahead of key US dataHere is what you need to know on Wednesday, June 3:
Author  FXStreet
Jun 03, Wed
Here is what you need to know on Wednesday, June 3:
placeholder
Bitcoin drops below $65K amid reinforced bear market signalsBitcoin (BTC) dipped further below $65,000 on Wednesday, with onchain data from Glassnode signaling a market firmly in a bear phase. The decline has pushed prices back into a key valuation range between the Realized Price and the True Market Mean.
Author  FXStreet
Jun 04, Thu
Bitcoin (BTC) dipped further below $65,000 on Wednesday, with onchain data from Glassnode signaling a market firmly in a bear phase. The decline has pushed prices back into a key valuation range between the Realized Price and the True Market Mean.
placeholder
Gold declines below $4,500 on stalled US-Iran ceasefire talks, US NFP data loomsGold price (XAU/USD) edges lower to near $4,470 during the early Asian session on Friday. The precious metal remains volatile amid ongoing geopolitical turmoil. Traders will closely monitor the developments surrounding the US-Iran peace deal and the US May employment report later on Friday. 
Author  FXStreet
Yesterday 01: 25
Gold price (XAU/USD) edges lower to near $4,470 during the early Asian session on Friday. The precious metal remains volatile amid ongoing geopolitical turmoil. Traders will closely monitor the developments surrounding the US-Iran peace deal and the US May employment report later on Friday. 
goTop
quote