Home Daily Commentaries Recent CAD gains at risk as jobs report disappoints

Recent CAD gains at risk as jobs report disappoints

Daily Currency Update

The Canadian dollar is holding the ground it has gained over the last 2 weeks. However, this could come to an end as the Canadian economy unexpectedly lost 17,000 jobs in May as stated today by StatsCan. This contrasted with the expected addition of 23,000 jobs and the 41,000 positions that were added in April. Oil is also holding its ground today with the West Texas Intermediate (WTI) oil index price sticking in the $71 per barrel range.

Key Movers

The US dollar index (DXY) is entering Friday up 0.04% from yesterday against a basket of major currencies. While there are no significant US data releases today, markets are looking ahead to the release of the Consumer Price Index (CPI) inflation data next Tuesday. Market participants are also awaiting the Federal Open Market Committee’s (FOMC) interest rate decision on Wednesday. Analysts believe that the Federal Reserve is unlikely to hike rates this month but could set up a 25-basis point (bps) bump in July.

The JPY is down in this morning’s trading as news out of Japan is signaling that the Bank of Japan sees the need to continue its monetary stimulus. This stimulus will continue to add Yen into the system, devaluing the currency.

The Euro and GBP are both holding steady to end the week. Both currencies, like the USD, are facing central bank announcements next week with more possible rate hikes in the UK and Eurozone.

Expected Ranges

  • EUR/CAD: 1.4348 - 1.4436 ▲
  • GBP/CAD: 1.6680 - 1.6785 ▲
  • AUD/CAD: 0.8914 - 0.8998 ▲
  • USD/CAD: 1.3318 - 1.3425 ▲