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Canadian Dollar Strength Holds on Jobs Numbers

Published September 8, 2017
  • Canadian jobs numbers beat expectations, with the Unemployment Rate coming in at 6.2% vs. an expected 6.3%, and the change in the number of employed people increasing by 22.2K vs. expectations of 17.8K. Given the Bank of Canada’s focus on Labour and Employment numbers in its statement, today’s print was likely in line with BoC expectations
  • Numerous Federal Reserve officials spoke yesterday after the session closed, all striking a hawkish note, saying low inflation should rebound, and that the Federal Reserve should continue to increase interest rates and unwind its balance sheet. It seems markets were skeptical, as the odds of a Fed rate hike by 2018 were still 2/3 against after these statements
  •  USD/CAD is sitting at multi-year lows at the 1.21 level, and is being weighed down by multiple factors; ongoing friction with North Korea, pressure from funds flowing from USD to Euro, the massive Hurricane Irma which is expected to hit Florida this weekend, and the economic impact of Hurricane Harvey and the uncertainty it may have on Fed decision making for the remainder of 2017
  • Oil prices are mixed this morning as Irma, the most powerful tropical storm in 100 years, is set to make landfall. Hurricane Harvey caused a week of oil price increases as the storm took 8% of U.S. oil production offline, and forced the shutdown of 25% of America’s refineries. At the time of writing, WTI is down 0.10% on the day to $49.04, and Brent Crude is up 0.44% to $54.73. Brent prices were supported by news that Saudi Arabia plans to cut oil supply allocations by 350,000 barrels per day in October
  • Mexico was hit by the biggest earthquake in a century late yesterday, with a magnitude of 8.2. At least 32 people were killed in Mexico City, though the hardest hit areas of Chiapas and Oaxaca have yet to release a tally. The earthquake also triggered a tsunami, with warnings issued for people in Guatemala, El Salvador, Costa Rica, Nicaragua, Panama, Honduras, and Ecuador.