CAD Recovers After Last Week’s Employment Drop

The Canadian dollar was higher Monday amid strong domestic housing data and a greater willingness to take on risk, even as traders kept a close watch on geopolitical flashpoints.

“A volatile global environment, with some easing in concern over Ukraine offset by an escalation in Iraq , is being watched carefully by markets,” observed Camilla Sutton , Chief FX Strategist, Managing Director Scotiabank Global Banking and Markets.

The loonie was up 0.14 of a cent to 91.29 cents US as Canada Mortgage and Housing Corp. reported that housing starts during July came in at an annualized rate of 200,098, up slightly from 198,665 in June.

The currency tumbled over 4/10s of a cent Friday in the wake of a huge miss in July employment data. Only 200 jobs were created last month, a far cry from the estimated 20,000 positions that economists had expected.

On Monday, traders felt more inclined to take on risk after Russia called an end to military exercises near Ukraine on Friday and withdrew troops to their bases.

via Kitco

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza