Canadian Dollar Unchanged As Investors Search For Cues
The Canadian dollar has ticked higher in the Monday session. Currently, the pair is trading at 1.2587, up 0.06% on the day. On the release front, there are no Canadian indicators on the schedule. In the US, the sole indicator is the federal budget balance, which is expected to rebound and show a large surplus of $50.2 billion. This would mark the first surplus since September.
Last week’s market selloff boosted the US dollar, at the expense of the Canadian dollar and most other major currencies. The Canadian dollar dropped 1.2% last week, and is down 2.2% in February, erasing the gains we saw in January. Interestingly, the catalyst for the current turbulence has been solid economic data in the US, namely, improved payrolls and wage growth reports. Is the correction over? It’s too early too tell, since much of the sell-off is related to investor concerns over possible interest rate hikes by major central banks. The Bank of England has said it could accelerate its pace of hikes, and the Federal Reserve could follow suit if inflation moves higher.
Canadian employment growth has impressed in recent months, but the trend reversed sharply in January. Employment Change plunged by 88.0 thousand, well off the estimate of +10.3 thousand. The unemployment rate climbed from 5.7% to 5.9%, missing the estimate of 5.8%. The Canadian dollar reacted on Friday with losses, but managed to recover and ended the Friday session almost unchanged.
Monday (February 12)
- 14:00 US Federal Budget Balance. Estimate 50.2B
*All release times are GMT
*Key events are in bold
USD/CAD for Monday, February 12, 2018
USD/CAD, February 12 at 10:05 EST
Open: 1.2580 High: 1.2606 Low: 1.2556 Close: 1.2587
USD/CAD has showed little movement in the Asian and European sessions
- 1.2494 is providing support
- 1.2630 is a weak resistance line
- Current range: 1.2494 to 1.2630
Further levels in both directions:
- Below: 1.2494, 1.2351, 1.2190 and 1.2060
- Above: 1.2630, 1.2757 and 1.2855
OANDA’s Open Positions Ratio
USD/CAD ratio is almost unchanged in the Monday session. Currently, long positions have a majority (51%), indicative of a lack of trader bias towards as to what direction USD/CAD takes next.