The Canadian dollar is almost unchanged in the Monday session. Currently, USD/CAD is trading at 1.2754, down 0.07% on the day. On the release front, Canada will release Ivey PMI, which is expected to improve to 60.2 points. In the US, FOMC member William Dudley will speak, and could announce his retirement from the Federal Reserve. On Tuesday, Fed Chair Janet Yellen and Bank of Canada Governor Stephen Poloz will speak at public engagements.
Canadian employment data was sharp on Friday, as the economy produced 35.3 thousand jobs, well above the estimate of 15.3 thousand. This marked the highest gain since June. South of the border, job numbers were a disappointment. After a decline in September, a result of the hurricanes which battered the US, nonfarm payrolls rebounded sharply with a reading of 261 thousand. This was a respectable number, but still fell short of the forecast of 312 thousand. Wage growth also disappointed, slowing to 0.0%, short of the estimate of 0.2%. This marked the first time in 2017 that wage growth did not increase, underlining persistent weak inflation. Although Fed Chair Yellen and other Fed policymakers have expressed confidence that inflation levels will rise, this is still yet to occur, despite strong growth and a labor market at capacity.
On Thursday, US President Trump nominated Federal Reserve Governor Jerome Powell to head the Federal Reserve. Powell will take over in February 2018 when Yellen’s term expires. Powell is expected to hold the course with monetary policy, which has been marked by incremental and small rate hikes since December 2015. It’s all but a given that the Fed will raise interest rates in December, but the forecast for 2018 is less clear. If the US economy continues to grow at current levels, we could see up to three rate hikes next year. Powell will also be tasked with continuing to trim the Fed’s huge balance sheet of $4.2 billion. Last month, the Fed has started trimming the balance sheet by $10 billion/mth, but these cuts are expected to increase in size next year.
Monday (November 6)
- 10:00 Canadian Ivey PMI. Estimate 60.2
- 12:10 US FOMC Member William Dudley Speaks
- Tentative – US Loan Officer Survey
Tuesday (November 7)
- 12:55 BOC Governor Stephen Poloz Speaks
- 14:30 US Federal Chair Janet Yellen Speaks
*All release times are GMT
*Key events are in bold
USD/CAD for Monday, November 6, 2017
USD/CAD Monday, November 6 at 8:10 EDT
Open: 1.2763 High: 1.2779 Low: 1.2742 Close: 1.2754
USD/CAD has been flat in the Asian and European sessions
- 1.2701 is providing support
- 1.2778 is the next resistance line
- Current range: 1.2701 to 1.2778
Further levels in both directions:
- Below: 1.2701, 1.2598 and 1.2441
- Above: 1.2778, 1.2943, 1.3032 and 1.3126
OANDA’s Open Positions Ratio
USD/CAD ratio is showing little movement in the Monday session. Currently, long and short positions are almost evenly split, indicative of a lack of trader bias as to what direction USD/CAD takes next.