USD/CAD Fundamental Analysis October 14, 2014 Forecast

Analysis and Recommendations:

The USD/CAD is trading at 1.12 gained a few pips today as the CAD continues to weaken as oil prices continue to fall.  The S&P 500 recorded its worst week in couple of years dropped as 60 points in one trading week. Many commodities prices have fallen sharply as well. Oil prices have tumbled, WTI price has fallen 10% in the past two weeks. However the US dollar took a break last week and ended a streak of 12 consecutive weekly gains for the Dollar Index. The Dollar was the worst performer last week, while the yen easily led the way as risk aversion set in.

The Canadian dollar weakened against most major currencies in the Asian session on Monday following a slide in oil prices amid expectations of lukewarm demand and the general risk aversion. Crude oil is currently down $ 1.05 to $ 84.77 a barrel. The oil prices plunged as investors continued to fret over demand growth with evidence of a supply glut, on Increased output from the US, Russia, and the OPEC.

The currency strengthened after job creation more than tripled the average forecast of private sector economists and the economy created a record number of private sector jobs in September. The rise in payrolls comes after the country lost jobs the previous month and reports last week showed gross domestic product growth stalled in July and the country posted an unexpected trade deficit in August.

The unemployment rate fell to 6.8 percent last month, the lowest since December 2008 and down from 7 percent a month earlier, Statistics Canada said today in Ottawa. The economy created 74,100 jobs, the majority in full-time employment, after recording a decline of 11,000 jobs in August. Economists surveyed by Bloomberg News projected a 20,000 job increase and an unchanged unemployment rate, according to median forecasts. A statistical error has been called to the attention of the markets and is currently being reviewed.

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 actual vs. forecast:

 

Upcoming Economic Events that you should be monitoring:

Government Bond Auction

Date Time Country Auction

Oct 14 08:30 Spain 6 & 12M T-bill auction

Oct 14 09:30 Belgium 3 & 12M T-bill auction (Jan & Oct 2015)

Oct 15 09:03 Sweden Bond auction

Oct 15 09:30 Germany Eur 4.0bn Sep 2016 Schatz auction

Oct 16 08:30 Spain Bono/Obligacion auction

Oct 16 09:30 UK Auctions 0.125% 2024 I/L Gilt

Oct 16 15:00 US Announces details of 30Y TIPS auction on Oct 23