Mixed Canadian Employment Data Keep the CAD Looking for a Definite Direction.
LONDON, Oct. 12, 2015 /PRNewswire/ -- Friday's mixed Canadian employment data has left traders looking for a definitive direction of the Canadian dollar.
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There was better than expected readings for Canadian employment change, which shows the economy created 12.1K jobs in September, rather than the forecasted 10.5K.
However, this positive data was balanced out with an unexpected increase in Canada's unemployment rate, which increased to 7.1%. Forecasts predicted a drop in unemployment from 7% to 6.9%.
"These readings have not given a clear direction for the Canadian dollar and has certainly left a mixed picture about the Canadian labour market. As we know, uncertainty is something the markets do like - which is why the Canadian dollar traded at slightly lower levels after these reading were released," explains Jarratt Davis, Head of FX at Smile Global Management.
"Traders should also pay close attention to specific figures within this data, which unveil some interesting dynamics within the Canadian labour market.
"The first point to consider is that September saw a decline in 61.9K full time positions, while part time positions had a gain of 74K - suggesting that high paid and secure job creation is far from concrete. Having said that, the participation rate still has a reading of 65.9%."
Last week the Canadian dollar rallied against the US dollar, thanks in part to the recent increase in oil prices, plus the nervousness of the market following weaker than expected non farm payrolls data. However, Friday's mixed Canadian employment data still leaves traders in uncertain territory.
"The outlook remains neutral for the Canadian dollar. The key market mover traders should be monitoring is the Federal Reserve's timing of hiking US interest rates," adds Jarratt Davis.
"The market is currently split on whether this will happen in the latter part of 2015 or early 2016 - but when they do hike interest rates, this will have a noticeable impact on weaker major currencies, such as the Canadian dollar."
For further market commentary from Jarratt Davis, please email email@example.com.
To view the original version on PR Newswire, visit: http://www.prnewswire.com/news-releases/mixed-canadian-employment-data-keep-the-cad-looking-for-a-definite-direction-300157595.html
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|Date:||Oct 12, 2015|
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