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USD/CAD Fundamental Analysis – August 7, 2015 – Forecast

Barry Norman

Analysis and Recommendations:

The USD/CAD eased a bit away from its highs as traders reconsidered the price which is trading at 1.3170 well above its recent trading ranges. Gold and oil remain weak weighing on the currency.  When asked whether the dollar’s strength – one of the main reasons behind disappointing U.S. data since the beginning of this year – will get in the Fed’s way with its rate hikes over the next year, analysts were split. The Canadian dollar hit a new 11-year low today against its U.S. counterpart, as weak oil prices and a possible further interest rate cut continue to hurt sentiment in Canada’s currency.

The U.S. Federal Reserve is widely expected to raise its key lending rate later this year — a likelihood that is helping to drive the U.S. dollar higher against the loonie.  Negative sentiment about the Canadian dollar was further reinforced last Friday when Statistics Canada reported GDP figures for May that showed the economy contracted by 0.2 per cent, against expectations of no change.

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 up to the data analysis and information in our weekly reports.

Today’s economic releases:

Cur.

 

Event

Actual

Forecast

Previous

 

  AUD

 

Employment Change (Jul)

38.5K

10.0K

7.0K

   

  AUD

 

Unemployment Rate (Jul)

6.3%

6.0%

6.1%

   

  EUR

 

German Factory Orders (MoM) (Jun)

2.0%

0.2%

-0.3%

   

  GBP

 

Halifax House Price Index (YoY) (Jul)

7.9%

8.2%

9.6%

 

 

  GBP

 

Industrial Production (MoM) (Jun)

-0.4%

0.1%

0.3%

   

  GBP

 

Manufacturing Production (MoM)

0.2%

0.2%

-0.6%

 

 

  GBP

 

BoE Inflation Report

 

 

 

 

 

  GBP

 

BoE QE Total (Aug)

 375B

375B

375B

 

 

  GBP

 

Interest Rate Decision (Aug)

 0.50%

0.50%

0.50%

 

 

  GBP

 

BoE MPC Meeting Minutes

 

 

 

   

 

Upcoming Economic Events that you should be monitoring:

Friday, August 7, 2015

Cur.

 

Event

Actual

Forecast

Previous

 

  JPY

 

BoJ Press Conference  

 

 

 

 

 

  USD

 

Nonfarm Payrolls (Jul)

 

223K

223K

 

 

  USD

 

Unemployment Rate (Jul)

 

5.3%

5.3%

 

 

  CAD

 

Employment Change (Jul)

 

5.0K

-6.4K

 

 

  CAD

 

Ivey PMI (Jul)

 

52.0

55.9

   

Government Bond Auctions

Date Time Country

Aug 06 10:30 Spain Auctions Bonos

Aug 06 11:10 France Auctions OATs

Aug 10 17:30 Italy Announces details of BTP/CCTeu on 13 Aug

Aug 11 11:30 UK Auctions 0.125% 2058 I/L Gilt

Aug 12 11:30 Germany Eur 4bn Aug 2025 Bund

Aug 13 11:10 Italy Auctions BTPs/CCTeus

Aug 19 11:30 Germany Eur 5bn Sep 2017 Schatz

Aug 19 11:03 Sweden Holds bond auction

Aug 20 10:30 Spain Auctions Bonos/Obligaciones

Aug 20 11:30 UK Auctions 4.25% 2036 Gilt

Aug 21 17:30 Italy Announces details of CTZ/BTPei on 26 Aug

 

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