CAD loses weekly gains against the USD
Friday 3 February, 2023
Daily Currency UpdateOn Friday, the Canadian dollar lost value against the USD, putting it on course to end its weekly winning streak. This shift occurred after data released in the U.S. showing the economy added significantly more jobs than anticipated in January. Crude oil prices dropped to a nearly four-week low at the end of this week largely due to the lack of clarity surrounding China's economic rebound. China’s economic uncertainty is weighing on fuel demand prospects and putting downward pressure on prices. This is seen as undermining the commodity linked Canadian Dollar. USD/CAD peaked over 1.34080.
Key MoversThe dollar index climbs to 102 today, Friday, February 3rd, bouncing back from a nine-month low of 100.82 set Thursday, February 2nd. This uptick showed the USD strengthening against its major rivals. The most recent jobs report indicated an unexpectedly large number of new job openings as well as a moderate uptick in average hourly earnings. Today's release of the US Bureau of Labor Statistics' (BLS) data showed that Nonfarm Payrolls increased by 517,000 in January. The report also showed that annual wage inflation, as measured by Average Hourly Earnings, was 4.4%, instead of the predicted 4.9%. On Thursday, the European Central Bank (ECB) hiked interest rates by 50 basis points (bps) as expected. President Christine Lagarde stated during the ECB press conference that the outlook for growth and inflation in the Eurozone has become more positive. The EUR which was trading around 1.09330 against the USD earlier in the day saw its modest gains quickly vanish with the release of the Jobs report out of the US. The initial reaction showed EUR/USD plunging below 1.0900 and trading around the 1.08460 mark. UK policymakers increased interest rates by 50 bps on Thursday, bringing the bank rate up to 4%. This is the 10th straight hike and takes rates back to levels last seen in late 2008. The GBP, which was already under pressure due to the Bank of England’s dovish commentary relative to the ECB and US Fed, came under additional pressure today as the US jobs report sent the Pound falling from its daily high of around 1.22570, to a 3-week low of below 1.21.
- EUR/CAD: 1.4611 - 1.4513 ▼
- GBP/CAD: 1.6381 - 1.6219 ▼
- AUD/CAD: 0.9451 - 0.9320 ▼
- USD/CAD: 1.3300 - 1.3421 ▲