Canadian Dollar Eyes US, Canadian Job Reports

The Canadian dollar continues to sag and has dropped 1.9% this week. Hold onto your hats, as we could have some further volatility from USD/CAD in the North American session, with the release of the US and Canadian employment reports. All eyes on NFP The highlight of the day is the US nonfarm payrolls report, […]

Canadian Dollar at Extremums

USDCAD has been rallying this week, gaining 1.7% since Tuesday and testing the five-month high of 1.3850. The pair looks vulnerable to both a short-term correction and the potential for a longer-term reversal. The US Dollar has enjoyed gains after Powell’s hawkish rhetoric forced the markets to consider a 50-point rate hike on 22 March […]

Canada's Labour Market Continues to Roll  

The Canadian labour market added 22k positions in February, with full-time employment up 31.1k and part-time employment down 9.3k. The unemployment rate held steady at 5.0%. The participation rate also held at 65.7%. By industry, employment was up in health care (+15k), public administration (+10k), and utilities (+7.5k). Losses were seen in business, building and […]

Resilient Labor Market Suggests FOMC Will Need to Raise Rates by 50bps Later This Month 

The U.S. economy added 311k jobs in February, well ahead of the consensus forecast of 225k. Revisions to the two months prior were slightly negative, subtracting 34k from the previously reported figures. Employment gains on the service-side (+245k) remained strong and were concentrated in leisure & hospitality (+105k), health care (+63k), professional & business services […]

How Worried Should Forex Traders Be Over the SVB Crisis?

US stock indices dropped substantially yesterday, led by the Nasdaq and prompting a general sell-off across the world. A ~2% drop in the stock market isn’t all that unusual, but this time it was caused by a massive drop in the banking sector. And when banks are in trouble, forex traders would do well to […]

Sunset Market Commentary

Markets The developing Silicon Valley Bank story kept markets hostage and determined today’s reaction to the latest US payrolls release. Yesterday’s surprise announcement by SVB that it wanted to raise $2.25bn by issuing shares to strengthen its capital position triggered a strong risk-off move. SVB is considered a (one of the first) victim(s) of central […]

Weekly Focus

The biggest market mover this week was Fed Governor Jerome Powell’s hawkish testimony in the Senate. Powell pointed to an “extremely tight labour market” and stated that the Fed was prepared to speed up rate rises if warranted by data, thus opening the door for a possible 50bp hike at the upcoming meeting on 22 […]

Week Ahead – US Inflation, ECB Decision to Test Markets' Nerve

The US inflation report and the European Central Bank’s policy meeting will share the limelight next week amid another round of ratcheting up of rate hike expectations by investors. Other critical data such as Chinese industrial output, Australian employment and New Zealand GDP estimates might thus get overshadowed. Meanwhile in the UK, it’s budget time […]

Week Ahead – ECB Playing Catch-Up

US The labor market is still strong but is showing signs it is ready to soften as wages cool.  Wall Street will pay close attention to the February inflation report.  Disinflation trends are struggling here and a hot report could not only lock the Fed into boosting their hiking pace but possibly lead markets into […]

U.S. Inflation Easing, But Still Sticky

U.S. headline inflation will be anxiously awaited next week as Fed officials debate how much to raise interest rates. We expect Tuesday’s report to show the year-over-year measure falling to 5.9% in February compared to 6.4% January (which was the lowest reading since October 2021). Much of that easing has come from lower energy prices […]