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USD/CAD Fundamental Analysis – week of June 13, 2015
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The USD/CAD had a crazy week as oil and gold bounced and the US dollar recovered at the end of the week. The CAD is trading at 1.2784 with a gain on
The USD/CAD had a crazy week as oil and gold bounced and the US dollar recovered at the end of the week. The CAD is trading at 1.2784 with a gain on Friday of 0.49% but the pair ended down for the week by over 1%. The CAD remains a strong performer in year-to-date terms but the past month has seen the CAD retreat against the USD for the first time since January. A number of factors have come together to check the CAD’s recovery. Firstly, the relative outperformance of the Canadian economy over the US is poised to reverse in Q2; Canadian activity has been clipped back by the impact of the wildfires in Alberta and the US economy now looks poised to recover from a weak start to the year. Consequently, interest rate differentials — which had narrowed against the USD earlier in the year — have started to widen in the USD’s favor again, reflecting better US growth dynamics and clear messaging from the Fed to prepare for policy tightening.
A third factor is that crude oil prices have settled into a trading range and, capped around $50/bbl., provide much less support for the CAD than earlier in the year when prices were recovering strongly. Our own correlation studies reflect a decline in the influence of commodity prices on the CAD and an increase in the influence of short-term interest rate differentials on spot in the past few weeks.
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:
| Time | Cur. | Event | Actual | Forecast | Previous | |||
| Sunday, June 12, 2016 | ||||||||
| 09:30 | CNY | Industrial Production (YoY) (May) | 5.9% | 6.0% | ||||
| Tuesday, June 14, 2016 | ||||||||
| 12:30 | GBP | CPI (YoY) (May) | 0.4% | 0.3% | ||||
| 16:30 | USD | Core Retail Sales (MoM) (May) | 0.4% | 0.8% | ||||
| 16:30 | USD | Retail Sales (MoM) (May) | 0.3% | 1.3% | ||||
| Wednesday, June 15, 2016 | ||||||||
| 12:30 | GBP | Claimant Count Change (May) | -2.4K | |||||
| 16:30 | USD | PPI (MoM) (May) | 0.3% | 0.2% | ||||
| 18:30 | USD | Crude Oil Inventories | -3.226M | |||||
| 22:00 | USD | Fed Interest Rate Decision | 0.50% | 0.50% | ||||
| 22:30 | USD | Fed Chair Yellen Speaks | ||||||
| Thursday, June 16, 2016 | ||||||||
| 02:45 | NZD | GDP (QoQ) (Q1) | 0.9% | |||||
| 05:30 | AUD | Employment Change (May) | 15.0K | 10.8K | ||||
| 07:00 | JPY | BoJ Monetary Policy Statement (YoY) | ||||||
| 10:30 | JPY | BoJ Press Conference | ||||||
| 12:30 | GBP | Retail Sales (MoM) (May) | 0.3% | 1.3% | ||||
| 13:00 | EUR | CPI (YoY) (May) | -0.1% | -0.1% | ||||
| 15:00 | GBP | Interest Rate Decision (Jun) | 0.50% | 0.50% | ||||
| 16:30 | USD | Core CPI (MoM) (May) | 0.2% | 0.2% | ||||
| 16:30 | USD | Philadelphia Fed Manufacturing Index | -1.8 | |||||
| Friday, June 17, 2016 | ||||||||
| 16:30 | USD | Building Permits (May) | 1.150M | 1.130M | ||||
| 16:30 | CAD | Core CPI (MoM) (May) | 0.3% | 0.2% | ||||
Upcoming Government Bond Auctions
Date Time Country
Jun 13 11:10 Italy Holds bond auction
Jun 13 11:30 Germany Eur 3bn Dec 2016 Bubill
Jun 15 10:30 Denmark Holds bond auction
Jun 15 11:30 Germany Eur 4bn 0.50% Feb 2026 Bund
Jun 15 17:20 Sweden Details of bond auction on Jun 22
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Jun 16 11:50 France Holds bond auction
About the Author
Barry Normanauthor
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