Canadian Dollar Currency Exchange Update August 7, 2015 – US Dollar Higher
USD/CAD Open: 1.3141-1.3142 Overnight Range: 1.3053-1.3157
The Canadian dollar was rangebound in overnight currency exchange markets. Oil is at $44.47 and gold is at $1,086. US futures are lower. Today, both Canada and the US release employment reports for July.
The short term Canadian dollar technicals are neutral. For today, USD resistance is at 1.3179. Support is at 1.3076.
The Canadian dollar continues to trade in a narrow range in the wake of today’s dual employment release. Both employment reports fell relatively in line with expectations, with Canadian job data slightly exceeding expectations and US data slightly missing. The end result was the US dollar climbing towards the high end of this week’s range, as some concern of a soft employment report had been priced in. Strong labour market data continues to firm expectations for a September rate hike by the Fed. Inflation will continue to be an important consideration leading up to the September FOMC meeting.
Canadian employment data is indicative of a fragmented labour market, with strong outlook for professional services, particularly in Ontario and Quebec. Manufacturing and natural resources continue to struggle, the former of which is seemingly idiosyncratic in the context of the weaker Canadian dollar. Another rate cut in Canada remains a possibility before the end of 2015. The possibility of a US rate hike coupled with a Canadian rate cut would push the Canadian dollar even lower.
The Canadian dollar is lacking catalysts and could see continued deterioration. The perfect storm for the loonie is here with a weak domestic economy, low commodity prices, and an improving US economy.
Today’s Suggested Range USD/CAD: 1.3100 – 1.3200
Sincerely,
Rahim Madhavji | Knightsbridge Foreign Exchange | Toll-Free: 1-877-355-5239
www.knightsbridgefx.com
Knightsbridge Foreign Exchange has based the opinions expressed herein on information generally available to the public. Knightsbridge Foreign Exchange makes no warranty concerning the accuracy of this information and specifically disclaims any liability for trading decisions based on the opinions expressed and information contained herein. Such information and opinions are for general information only and are not intended to present advice with respect to matters reviewed and commented upon.
By Admin | August 7, 2015 | Daily Update |
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