USD/CAD Daily Fundamental Forecast – November 1, 2017

The USDCAD pair continues to consolidate ahead of the range of news events scheduled for release in the week, with the first set being announced today. Each set of these news have the capacity to move the markets on their own and this is set to increase volatility in the markets over the next few days and also likely to set the tone for the short term, as far as the markets are concerned.

USDCAD Likely Seeing Change of Trend

We have the FOMC meeting minutes and the ADP employment report scheduled to be released later in the day and these will be watched closely by the market. The ADP report is considered to be a precursor to the NFP employment report later in the week and this will be an important parameter that will be used by the Fed in making its decision on the next rate hike.On the other hand, the FOMC minutes will be watched closely by the markets to see what the Fed members think about the next rate hike.

Also, we have the announcement for the next Fed Chair succeed Yellen tomorrow. This announcement is expected to be made by Trump and the reports say that it could most likely to be Powell rather than the hawkish Taylor who seemed to be favored initially. If this was so, then the market is likely to be a bit disappointed and this could show up in the dollar in the short term as this could mean slower rate hikes.

On the other hand, we have the CAD employment report later in the week but the CAD is still reeling under the effects of the BOC monetary report which said that it was not considering another rate hike anytime soon. This was a disappointment to the markets which were expecting the next rate hike from the BOC in December. A combination of the above events has helped to reverse the trend in the pair and it looks as though it is heading for 1.30 in the short term, despite the strength in the oil prices.