The USDCAD currency pair was trading up over 19 pips as the US dollar rallied against the Canadian dollar despite the release of upbeat Canadian jobs data in the North American session. Canada added 34,700 jobs in March, beating analysts’ consensus estimates of 12,000.
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In addition, Canada’s unemployment rate remained stable at 5.0% in March beating analysts’ expectations of an increase to 5.1%. However, the country’s labour force participation rate fell slightly to 65.6% from 65.7% in February.
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The Canadian dollar remained weak against its US competitor despite the mostly upbeat jobs data as investors wait for tomorrow’s nonfarm payroll data, which many expect to be optimistic despite yesterday’s ADP employment change data missing expectations.
The US nonfarm payroll data has beaten analysts’ expectations multiple times in the recent past despite the ADP employment change report suggesting that the NFP data will also miss estimates.
The Canadian dollar’s weakness could also be attributed to the weak crude oil prices tracked by the West Texas Intermediate (WTI), which has been trading sideways for most of today. Crude oil prices are still trading near the highs triggered by the OPEC+ sudden output cuts.
However, as tracked by the WTI, crude oil prices have been unable to break above the crucial $81 resistance level, which could signal the beginning of a new uptrend. Until this critical level is broken, crude oil prices will remain within the familiar territory and will not boost the Canadian dollar despite the country being an oil exporter.
The release of upbeat US initial jobless claims data by the US Department of Labor, which showed that jobless claims fell to 228,000 from 246,000 last week, also boosted the US dollar, despite the figure being higher than analysts’ expectations of 200,000 claims.
The US dollar was also boosted by receding investor risk sentiment. Many expect the Fed to pause its rate hikes as US labour demand shrinks, as evidenced by the increasing number of job cuts and the decreasing number of advertised job opportunities. Still, the markets are focused on tomorrow’s nonfarm payroll data.
*This is not investment advice.
The USDCAD price chart.
The USDCAD currency pair was trading up 19.7 pips (0.15%) at writing as the US dollar rallied against the Canadian dollar.
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