USDCAD news - page 22
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Canada August industrial product price -0.3% m/m vs -0.5% expected
Canadian producer price data for August:
Raw materials prices are plummeting and that will eventually hit the main CPI. The numbers are slightly better than expected but this is a low tier indicator and rarely, if ever, moves CAD.
Canada's GDP Beats Estimates on Strong Oil and Gas Extraction, Factory Output
July's economic activity in Canada continued to build on June's advance, confirming a third quarter (Q3) turnaround, after two quarterly contractions in a row this year.
GDP rose 0.3% in July, while June's growth was downwardly revised to 0.4%, Statistics Canada said on Wednesday. The freshly released figure beat market projections of a 0.2% advance. On an annual basis, the economy grew 0.8%.
Improved growth will offer support to the Canadian dollar, boosting it against the US peer, after the USD/CAD pair traded near 11-year highs during the previous session.
Oil & gas extraction
Overall, the goods producing industries were up 0.8% and the service-producing industries increased 0.2%.
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USD/CAD: Loonie Strengthens in Relief Rally
Traders have been exiting some short positions on the Canadian dollar, which pushed the pair to one-week lows and the USD/CAD was seen at daily lows, trading around C$1.3265.
In the previous session, Canadian GDP came out somewhat positive, when the monthly change for July decreased from 0.4% to 0.3%, and year-on-year it printed 0.8%, up from 0.5% previously. Both figures beat forecasts, but June's numbers were revised down.
The CAD managed to strengthen after these results, but it was more of a broad relief rally on commodity-backed currencies, when both the AUD and NZD were moving higher as well.
From the US dollar point of view, the ADP report came out above estimates and hit 200,000, while the previous number was revised down from 190,000 to 186,000. The Chicago PMI, however, deteriorated sharply.
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USD/CAD: Loonie Near Two-Week High After Weak US Employment Data
The USD/CAD pair dropped after the greenback faced pressure from a weak labor market report, which raised concerns that the Federal Reserve could delay a rate hike until 2016.
The so-called loonie rose 0.30% to C$1.3228 against the greenback, after hitting the intraday high of C$1.3203.
Volatility was expected following the US labor market report, which was eyed by all traders on Friday. The data revealed that the economy hired only 142,000 workers in September, nowhere near the 201,000 increase in payrolls the markets had projected.
Moreover, the downgrade to 136,000 for August made things even worse, while July was scaled back to 223,000. Over the past three months, payrolls grew just 167,000, which is the weakest print since the period from December 2013 through February 2014. The risk is that the disappointing numbers could convince the Federal Reserve not to begin raising rates later this year.
"Payrolls were much weaker than expected. Taken literally, the data suggest sudden slowing in the trend, but the lack of an uptrend in claims cautions against extrapolating," chief US economist at High Frequency Economics, Jim O'Sullivan, said in a note.
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USD/CAD forecast for the week of October 5, 2015
The USD/CAD pair initially tried to rally during the course of the week, but turned back around to form a fairly negative candle. This is essentially because of the poor jobs number on Friday, and as a result it looks like we will more than likely pullback from here. However, we see a significant amount of support between the 1.28 level and the 1.30 level, so at this point in time we are not interested in selling at all. We are simply waiting for a supportive candle in order to go long, and continue the longer-term uptrend.
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USD/CAD Forecast Oct. 5-9
The Canadian dollar flexed some muscle last week, as USD/CAD dropped almost 200 points, closing at 1.3150. There are 9 events this week, highlighted by Employment Change. Here is an outlook on the major market-movers and an updated technical analysis for USD/CAD. The Canadian dollar gained ground as a result.
In the US, the week ended on a sour note, as NFP report was a huge disappointment. The Canadian dollar gained ground as a result. Earlier in the week, Canadian GDP beat the forecast, which also helped the loonie improve against the greenback.
Updates:
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USD/CAD: Loonie Fails to Hold Gains, Pair Back Above C$1.31
Volatility was higher on Monday and the pair was seen correcting earlier losses as it jumped back above the C$1.31 handle, but was still trading 0.3% lower on the day.
The greenback was sold-off heavily after Friday's weak labor market data, which showed that businesses hired just 142,000 workers in September, nowhere near the 201,000 increase in payrolls the markets were expecting. Moreover, wage growth decelerated as well.
"Overall, the disappointing non-farm payrolls report is likely to continue to weigh modestly on the US dollar in the near-term undermined by heightened concerns that the US economy is slowing down and dampened Fed rate hike expectations. It will likely also reinforce concerns over the ongoing slowdown in global growth supporting safe haven currencies like the yen and euro," analysts at Bank of Tokyo-Mitsubishi wrote on Monday.
Investors continued to sell the CAD on Monday and it reached fresh three-week highs during London trading hours, when the pair was trading below the C$1.31 level.
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USD/CAD drops for fourth straight day, what's next
USD/CAD down nearly 4 cents from its highThe Canadian dollar started last week at an 11-year low but it's recovered nearly 400 pips since. Solid oil prices, better risk appetite and US dollar selling after the soft jobs report have all be drivers.
I like USD/CAD longs here. If the US economy really is slowing it will have negative consequences for Canadian exports and commodity prices. If the Fed stays on the sidelines it means the Bank of Canada will cut.
The short-term factor is oil. In all the latest market enthusiasm, oil hasn't made any great strides. It remains in the recent range and is now pressing against topside resistance. I expect it to turn back lower as US supply increases weigh on prices.
Technically, USD/CAD is now testing minor trendline support from the recent lows. This is the first area of support followed by 1.3000. I'm not in a rush to buy the pair but I think this is an attractive level to begin scaling in.
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August 2015 Canadian trade balance -2.53bn vs -1.20bn exp
Highlights of the August 2015 Canadian trade balance data report 6 October 2015
September 2015 Canadian Ivey PMI 53.7 vs 54.0 exp
September 2015 Canadian Ivey PMI