USD/CAD Weekly Fundamental Analysis- November 30 – December 4, 2015 – Forecast

Weekly Analysis and Recommendation:  

The USD/CAD ended the week at 1.3379 near the very top of its trading range as the dollar rallied and oil and gold prices fell.  The Canadian dollar weakened against a broadly firmer greenback on Friday, pressured by a drop in crude oil prices amid fresh volatility in Chinese stocks, while Canadian producer prices fell more than expected.    

Crude oil futures fell as disappointing Chinese data and worries over a global energy supply glut overshadowed geopolitical concerns. The Canadian dollar has been hit this year by the drop in the price of oil, a key export for the country.

Oil was also pressured by a drop in China equities after Reuters reported the stock regulator had widened its probe on brokerages to include the country’s fourth-biggest securities firm.  With oil down, “we’re seeing the loonie take it on the chin,” said Rahim Madhavji, president at KnightsbridgeFX.com.

On the domestic front, Canadian producer prices fell 0.5 percent in October, a bigger drop than expected and the third month of declines in a row.  After a relatively quiet week, investors face a slew of domestic economic data next week, including figures on economic growth, trade and the labor market.

The Bank of Canada will also make an interest rate announcement, though the central bank is widely expected to hold rates at 0.50 percent.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide daily updates and outlooks.

Major Economic Events for the week:

Upcoming Government Bond Auctions

Date Time Country 

Dec 01 11:30 UK 1.5% 2021 Gilt auction

Dec 02 16:30 Sweden Announces details of Bond on 11 Dec

Dec 03 10:30 Spain Auctions

Dec 03 10:50 France Auctions OATs

Dec 03 11:03 Sweden Holds I/L bond auction

Dec 04 11:03 Sweden Holds I/L bond auction