The Canadian dollar is unchanged in the Wednesday session. In North American trade, USD/CAD is trading at 1.3270. On the release front, the US releases JOLTS Job Openings, with the indicator expected to rise to 5.53 million. Crude Oil Inventories will also be released, with the estimate standing at -1.4 million barrels. The Bank of Canada will set its benchmark rate, which is expected to remain at 0.50 percent. On Thursday, the US releases unemployment claims, with the indicator expected to rise to 272 thousand.
Earlier in the week, the Canadian dollar climbed to its highest level since mid-October. The currency, which is sensitive to oil prices, was buoyed by the unexpected OPEC production agreement, which triggered a surge in crude prices. The improvement in the Canadian dollar has eased pressure on the BoC to lower rates. The bank is expected to maintain the rate at 0.50 percent, where it’s been pegged since July 2015. Analysts will be monitoring the rate statement, which will be the first since Donald Trump won the US presidential election. The US is easily Canada’s largest trading partner, and Trump’s economic policies will have a significant effect on the Canadian economy. The BoC had predicted third quarter growth of 3.2%, but the economy beat this projection, expanding at a clip of 3.5%.
The Federal Reserve will meet next week and the markets have priced a rate hike at 95 percent, most likely a quarter-point increase. This would mark the first hike by the Fed since last December, and sentiment towards the US dollar remains high. It will be interesting to see what happens early next year, with the Trump administration taking over in Washington. Trump has said he will increase governmentspending and cut taxes. This could lead to higher inflation levels, which means the Fed may need to adjust its outlook.
Wednesday (December 7)
- 10:00 US JOLTS Jobs Openings. Estimate 5.53M
- 10:30 US Crude Oil Inventories. Estimate -1.4M
- 15:00 US Consumer Credit. Estimate 17.5B
- 10:00 BoC Rate Statement
- 10:00 BoC Overnight Rate. Estimate 0.50%
Thursday (December 8)
- 8:30 US Unemployment Claims. Estimate 272K
*All release times are EST
*Key events are in bold
USD/CAD for Wednesday, December 7, 2016
USD/CAD December 7 at 9:00 EST
Open: 1.3276 High: 1.3293 Low: 1.3262 Close: 1.3280
- USD/CAD showed limited movement in the Asian and European sessions
- 1.3253 remains a weak support line
- 1.3371 is the next resistance line
Further levels in both directions:
- Below: 1.3253, 1.3120 and 1.3026
- Above: 1.3371, 1.3457, 1.3551 and 1.3648
- Current range: 1.3253 to 1.3371
OANDA’s Open Positions Ratio
USD/CAD ratio is unchanged in the Wednesday session. Currently, short and long positions are evenly split, indicative of a lack of trader bias as to what direction USD/CAD will take next.