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Canadian Dollar Surges on Positive Labour Data; US Dollar Held Back by Lack of Momentum

Published January 5, 2018
  • USD/CAD is over a cent lower after data revealed that the Canadian economy added 78,600 jobs this morning versus an expected 1,000. Canada’s unemployment rate also decreased to 5.7% versus an expected 6.0%, marking a 41-year low.
  • The majority of these new jobs in December were part-time. Canada gained 394,200 full-time jobs in 2017, the largest such gain since 1999, with this uptick being led by an increase in services and manufacturing jobs.
  • The Canadian Trade Balance was worse off with a reading of -2.5 billion versus an expected -1.2 billion; total imports rose by 5.8%, the largest such increase since July 2009.
  • US Non-Farm Payrolls missed the mark with only 148,000 jobs added to the US economy versus an expected 190,000. The US unemployment rate was steady at 4.1% while month-on-month average hourly earnings met its target at 0.3%.
  • Data on Purchasing Manager Indices from both the US and Canada are set to be released at 10:00 AM EST today. Growth in month-on-month factory orders in the US will be released at the same time.
  • Oil prices are lower this morning as traders took advantage of multi-year highs by cashing in profits before the end of the week. US production has again undermined the commodity’s rise as US shale output is set to increase by 780,000 barrels per day in 2018.
  • Data on euro zone inflation came in as expected with a year-on-year reading of 1.4 percent. German retail sales and French inflation data also indicated continued strength for the euro.