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USD/CAD Weekly Fundamental Analysis May 12 – 16, 2014 Forecast
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Weekly Analysis and Recommendation: The USD/CAD gained momentum this week to end at 1.0897 after opening the week at 1.0978 as the US dollar continued to
Weekly Analysis and Recommendation:
The USD/CAD gained momentum this week to end at 1.0897 after opening the week at 1.0978 as the US dollar continued to tumble as strong data continued to show a strong recovery in the US which will prompt the FOMC to increase its rate of tapering. Canadian jobs were very weak in April (-28.6k) leaving the labor market looking fairly soft — in line with what we see as fairly soft economic fundamentals.
The details were a mess.
|
Date |
Last |
Open |
High |
Low |
Change % |
|
May 09, 2014 |
1.0897 |
1.0832 |
1.0916 |
1.0817 |
0.60% |
|
May 08, 2014 |
1.0832 |
1.0898 |
1.0904 |
1.0815 |
-0.61% |
|
May 07, 2014 |
1.0898 |
1.0891 |
1.0908 |
1.0876 |
0.06% |
|
May 06, 2014 |
1.0891 |
1.0958 |
1.0961 |
1.0875 |
-0.61% |
|
May 05, 2014 |
1.0958 |
1.0978 |
1.0989 |
1.0949 |
-0.18% |
Canadian manufacturing sales are a hard call for March. On the negative side, industry sources reported a drop in auto sales and February posted such a manufacturing surge (+1.4% m/m) that it’s hard to see how the strength can be maintained. On the other hand, trade data reflected solid exports of cars (+1.1% m/m), aircraft (+8.3% m/m), and machinery (+4.0% m/m). New orders in February were through the roof (+10% m/m!). In short, the leading and coincident indicators are generally strong — but the base effects are lofty. Analysts splitting the difference and looking for a 0.5% m/m uptick in manufacturing sales — which would amount to one of the stronger quarters registered by manufacturing sales in years
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.
Historical: From 2011 to present
Highest: 1.1053 CAD on Apr 23, 2014
Average: 1.0042 CAD over this period
Lowest: 0.9407 CAD on Jul 26, 2011
Major Economic Events for the week of May 5 – 9 actual v. forecast for the Canadian & US Dollar
|
Date |
Currency |
Event |
Actual |
Forecast |
Previous |
|
May 05 |
CNY |
Chinese HSBC Manufacturing PMI |
48.1 |
48.4 |
48.3 |
|
|
USD |
ISM Non-Manufacturing PMI |
55.2 |
54.1 |
53.1 |
|
|
USD |
ISM Non-Manufacturing Employment |
51.3 |
53.6 |
|
|
May 06 |
CAD |
Trade Balance |
0.08B |
0.40B |
0.85B |
|
|
USD |
Trade Balance |
-40.38B |
-40.30B |
-41.87B |
|
|
CAD |
Ivey PMI |
54.1 |
54.0 |
55.2 |
|
May 07 |
CNY |
Chinese HSBC Services PMI |
51.4 |
51.9 |
|
|
|
CAD |
Building Permits (MoM) |
-3.0% |
4.3% |
-11.3% |
|
|
USD |
Nonfarm Productivity (QoQ) |
-1.7% |
-1.0% |
2.3% |
|
|
USD |
Unit Labor Costs (QoQ) |
4.2% |
2.6% |
-0.4% |
|
|
USD |
10-Year Note Auction |
2.612% |
2.720% |
|
|
May 08 |
CNY |
Chinese Trade Balance |
18.45B |
13.90B |
7.71B |
|
|
CNY |
Chinese Exports (YoY) |
0.9% |
-1.7% |
-6.6% |
|
|
CNY |
Chinese Imports (YoY) |
0.8% |
-2.3% |
-11.3% |
|
|
CAD |
Housing Starts |
194.8K |
175.0K |
156.6K |
|
|
CAD |
New Housing Price Index (MoM) |
0.2% |
0.2% |
0.2% |
|
|
USD |
Initial Jobless Claims |
319K |
325K |
345K |
|
May 09 |
CNY |
Chinese CPI (YoY) |
1.8% |
2.0% |
2.4% |
|
|
CNY |
Chinese PPI (YoY) |
-2.0% |
-1.8% |
-2.3% |
|
|
CNY |
Chinese CPI (MoM) |
-0.3% |
-0.1% |
-0.5% |
|
|
CAD |
Employment Change |
-28.9K |
12.0K |
42.9K |
|
|
USD |
JOLTs Job Openings |
4.01M |
4.21M |
4.13M |
Economic Highlights of the coming week that affect the American and Canadian Markets
|
Date |
Currency |
Event |
Forecast |
Previous |
|
May 12 |
USD |
114.0B |
-36.9B |
|
|
May 13 |
CNY |
17.7% |
17.6% |
|
|
CNY |
8.9% |
8.8% |
||
|
USD |
0.6% |
0.7% |
||
|
USD |
0.5% |
0.6% |
||
|
USD |
0.4% |
0.4% |
||
|
May 13 |
USD |
0.2% |
0.6% |
|
|
USD |
0.2% |
0.5% |
||
|
May 13 |
USD |
0.2% |
0.2% |
|
|
USD |
0.2% |
0.2% |
||
|
CAD |
1.0% |
1.4% |
||
|
USD |
6.00 |
1.29 |
||
|
USD |
1.7% |
1.7% |
||
|
USD |
85.7B |
|||
|
USD |
0.1% |
0.7% |
||
|
USD |
13.6 |
16.6 |
||
|
May 16 |
USD |
1.000M |
0.997M |
|
|
CAD |
6.08B |
|||
|
USD |
0.983M |
0.946M |
||
|
USD |
-1.7% |
|||
|
USD |
2.8% |
|||
|
USD |
84.5 |
84.1 |
||
|
USD |
74.6 |
74.7 |
Government Bond Auction
Date Event
May 12 EUR German 30-y Bond Auction May 12 GBP 30-y Bond Auction
May 12 JPY 30-y Bond Auction
May 13 EUR Italian 10-y Bond Auction
May 15 EUR Spanish 10-y Bond Auction
May 16 GBP 10-y Bond Auction
May 16 GBP 30-y Bond Auction
May 21 EUR German 10-y Bond Auction
About the Author
Barry Normanauthor
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