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The Loonie increases on strong economic data.

Isaac Figueroa

The Loonie was the big loser of the week from last Tuesday until 8:30 this morning; however, very positive economic data was published a few minutes ago; the employment change showed a 94.1 k versus 10.5 k read, and the unemployment rate came in at 5.6 percent versus a 5.8 percent read. These numbers made the USD/CAD pair fall quickly, almost 100 pips or 0.7 percent.

On top of that, crude prices surged more than 4 percent as the OPEC and Russia agree to cut oil output by 1.2 million barrels a day.

The US dollar was relatively flat the last couple of days, waiting for more economic data. Yesterday, the markets did not like the uncertainty and the arrest of Huawei’s Chief Financial Officer Meng, which came with many questions - not just how this would impact trade negotiations, but also who knew what and when. The recovery began with the White House confirming that Trump did not know about the arrest before his dinner with Xi, which adds to the intrigue. At the same time, WSJ ran an article that the Fed believes moderate inflation reduces the urgency for quarterly increases, which probably kept the US dollar flat.

However, this morning, the US dollar is falling 0.25 percent after bad data in the non-farm employment change, which came in at 155k, when it was expected at 198k. At the same time, the average hourly earnings month to month came in at 0.2 percent when the forecast was 0.3 percent.

The Euro strengthened against the US dollar yesterday, on the back of some soft US data releases, but generally, the range in EUR/USD has been steady.

German and French industrial production data printed weaker and stronger than expected this morning, and so it hasn’t had too much of an impact on the currency. The EUR/USD pair opens this morning at 1.1394 after bad economic data in the US.

Risk took a bit of a hammering early on yesterday morning as investors slowly digested the news that the CFO of Huawei had been arrested in Canada. Global stocks suffered, and the Greenback generally remained well bid throughout. Moves in GBP/USD were mostly muted as traders look ahead to the crucial parliamentary vote early next week.

The Australian dollar’s multi-day decline extended through yesterday due to dovish comments from RBA deputy governor Debelle, coupled with softness in commodity and European equity markets. With markets adopting a risk-off mood, the Aussie dollar is still trading above the 0.7200 handle, at 0.7226, touching intraday lows of 0.7192 by the close in yesterday’s session.

The NZD/USD pair had a low of 0.6857 in yesterday’s trading session; most commodity currencies suffered. However, It has recovered and it is trading at 0.6880 this morning. It is trading almost flat amid a lack of any local data releases from either NZ or Australia.