USD/CAD Fundamental Analysis October 6, 2014 Forecast

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Updated: Aug 24, 2015, 22:00 UTC

Analysis and Recommendations: The USD/CAD gained 18 points to trade at 1.1175 as the US dollar regained its momentum ahead of the US nonfarm jobs report

USD/CAD Fundamental Analysis October 6, 2014 Forecast

Analysis and Recommendations:

The USD/CAD gained 18 points to trade at 1.1175 as the US dollar regained its momentum ahead of the US nonfarm jobs report and the Canadian trade balance. The dollar index rose, moving in sync with U.S. Treasury yields, which have edged up in anticipation of a good jobs number. The index was on track for a 12th straight week of gains, a feat not seen in four decades, and highlighted how bullish investors were about the dollar’s prospects.

The September nonfarm payrolls data is due and a robust number could further fuel expectations of an early interest rate hike by the Federal Reserve. According to a Reuter’s poll of economists, nonfarm payrolls are seen coming in at 215,000, a big jump from August. The dollar index was up 0.25 percent at 85.793, not far from a four-year high of 86.218.

Gold and oil continues to trade on a weak note weighing heavily on the Loonie. Canadian exports have been rising, with the trade surplus increase to $2.6 billion in July, amid several months of expanding auto exports. The falling dollar helps make Canadian products competitive.

Canada’s loonie is also being hammered by lower prices of key commodities, including wheat, corn and oil. The Scotiabank commodities index released yesterday found prices were at their lowest level this year. This reflects the limp demand from China and the fact that oil, one of Canada’s most important exports, is getting more expensive for most of the world.

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:

Cur.	Event	Actual	Forecast	Previous
AUD	HIA New Home Sales	3.3%		-5.7%
CNY	Non-Manufacturing PMI	54.0		54.4
EUR	Spanish Services PMI	55.8	57.1	58.1
EUR	Italian Services PMI	48.8	49.6	49.8
EUR	French Services PMI	48.4	49.4	49.4
EUR	German Services PMI	55.7	55.4	55.4
EUR	Services PMI (Sep)	52.4	52.8	52.8
GBP	Services PMI (Sep)	58.7	59.1	60.5
EUR	Retail Sales (MoM)	1.2%	0.1%	-0.4%
USD	Nonfarm Payrolls (Sep)		215K	142K
USD	Private Nonfarm		210K	134K
USD	Trade Balance (Aug)		-40.90B	-40.60B
USD	Unemployment Rate		6.1%	6.1%