The Canadian dollar has started the new trading week quietly session. Currently, USD/CAD is trading at 1.2791, up 0.07% on the day. On the release front, Canada releases Housing Starts, which is expected to drop to 219 thousand. As well, the Bank of Canada releases its well-respected Business Outlook Survey. There are no US events on the schedule. On Tuesday, Canada releases Building Permits and the US releases PPI, a key inflation indicator.
On Friday, the US released a very soft nonfarm payroll report. The indicator fell to 103 thousand, well off the forecast of 188 thousand. Still, the markets do not appear overly concerned, as payroll reports often sag in March. On a more positive note, wage growth improved to 0.3%, up from 0.1% a month earlier. This release matched the estimate. The improvement is likely to reinforce sentiment that the Fed could press the rate trigger four times in 2018, which could push the US dollar higher.
After months of arduous negotiations, is a NAFTA agreement within reach? US President Trump has been pushing hard for a renegotiated NAFTA, and had threatened to walk away from the talks if his demands were not met. There are some outstanding issues still on the table, such as the US demand that all NAFTA-produced cars contain at least 50% US content and Trump’s demand that Mexico pay for a wall on its border with the US. Still, negotiators have sounded cautiously optimistic, and a report earlier this week said that the US was pressing for an announcement of agreement-in-principle at next week’s Summit of the Americas in Peru. The Canadian dollar has been under pressure over lingering uncertainty with regard to NAFTA, and a new deal could boost the Canadian currency.
Monday (April 9)
- 8:15 Canadian Housing Starts. Estimate 219K
- 10:30 BoC Business Outlook Survey
Tuesday (April 10)
- 8:30 Canadian Building Permits
- 8:30 US PPI. Estimate 0.1%
- 8:30 US Core PPI. Estimate 0.2%
*All release times are GMT
*Key events are in bold
USD/CAD for Monday, April 9, 2018
USD/CAD, April 9 at 7:50 EST
Open: 1.2782 High: 1.2819 Low: 1.2763 Close: 1.2791
USD/CAD was flat in the Asian session and has posted slight gains in European trade
- 1.2757 is providing support
- 1.2850 is the next resistance line
- Current range: 1.2757 to 1.2850
Further levels in both directions:
- Below: 1.2757, 1.2687 and 1.2590
- Above: 1.2850, 1.2930, 1.3050 and 1.3165
OANDA’s Open Positions Ratio
In the Monday session, USD/CAD ratio is showing a majority (54%), indicative of USD/CAD reversing directions and moving lower.