Canada jobs to trump the US

8 January, 2016

The more interesting jobs report today could be the one in Canada rather than the US. We’ve just seen a US rate hike, the Fed has stressed over and over again that further moves will be gradual, so it will take a very strong release for expectations to build for a move at the end of this month. In Canada, we’re seeing a contrary story playing out, with the unemployment rate having risen from 6.8% to 7.1% over the past few months, in part as the economy slows on the back of the falling oil price. This has already been felt on the currency so far this year, with USDCAD having pushed above the 140 level this week. The market is priced for around a 50% chance of a cut from the Bank of Canada by the April meeting, so this makes the release a lot more key for the currency than the US data for the dollar. Remember it was the Bank of Canada that came out with the first ‘surprise’ rate cut 12 months ago.

Although we’ve seen some stability in Asian stock markets overnight, it’s going to be an ugly first week of the year for equities. China has scrapped the circuit breakers that were brought in this week to reduce volatility and had the opposite effect. The Shanghai composite is currently little changed, with most other indices (Japan aside) trading in the green. We’ve also seen the mid-point on the USDCNY rate rise for the first time in 9 sessions, with some talk of the PBOC taking action to support the currency. We have inflation data at the weekend, so the focus will remain on China in the early part of next week. Oil prices have stabilised, which is providing some support for the commodity currencies, but overall we’re approaching the end of what has been a very volatile week which, if repeated through the year, will make it a very long one.


Source link  
BOJ Monetary Policy Remains Steady

The Bank of Japan maintained their monetary policy on Friday whilst upgrading their assessment of private consumption...

Final Confirmation for a June Rate Hike

The crucial US labour market data for May will be released today, June 2nd at 13:30 BST. It includes non-farm payrolls...

GBP Under Pressure

The Brexit negotiation process is one of the focuses of the upcoming UK election. Although the Conservative Party has pledged a smooth and orderly...


Oil Slumped Post OPEC Extension

On Thursday, OPEC announced that the existing output cut agreement will be extended for an additional 9 months...

USD Bounces From Month Low

Trump administration has presented its 2018 budget plan to Congress last evening. The budget plan calls to slash $3.6 trillion...

Dollar index hit a new low

The dollar index hit a new post presidential election low of 96.95 on Friday May 19th. EUR/USD hit a high of 1.1211...


USD Hit Post Election Low

To date the dollar index has almost given up all of the post presidential election rally...

BoE Expected to Keep Rates Steady

ECB Governor Draghi will make a speech in the Dutch Parliament at 12:00 BST today. It will be Draghi first speech...

Trump's Tax Reform Plan

US Treasury Secretary Mnuchin announced Trump’s tax reform plan in a press conference...

  


Share: