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- The Canadian dollar was returning to the water to finish the trading week.
- Canadian employment and wage data barely move the needle as investors focus on trade.
- The US -Chinese initial trade talks will determine during the weekend next week.
The Canadian dollar (CAD) was flat on Friday, sticking to approximately 1,3900 for US dollar (USD) while LONIE markets are struggling to find a reason to move away in either direction. The motivation is completely behind the market’s feelings through the upcoming commercial talks between the United States and China, which was appointed in Switzerland this week.
Canadian labor and wages data came mostly as expected on Friday. Canadian wage growth is still fixed, and the Canadian economy added some jobs more than expected in April. However, the Canadian unemployment rate is slightly higher, as any bullish trend of employment has been compensated better than expected.
Daily Digest Market Movers: The Canadian dollar market moves very little as the United States trade dominates
- The Canadian dollar fell less against Greenback this week, prompting the US dollar/CAD above 1.3900 before the exit on Friday.
- The average of the Canadian clock is fixed at 3.5 % year -old to April.
- Change the Kindy net in expectations of expectations in April, adding new parking 7.4 kilograms of 2.5 km. However, the figure still failed to decrease in a 32.6 thousand march.
- The Canadian unemployment rate rose up in April, as it rose to 6.9 % of 6.7 %. Medium market expectations expect to increase to 6.8 %.
- Exit next week: Canadian economic data takes the back seat again American inflation data becomes the focus axis.
Canadian dollar price expectations
A new bout of LONIE weakened this week kicked USD/CAD Again to the end, pick up a multi -price unification period and pay bids back above 1.3900. The husband is now walking in water near 1.3930, but the continuous bullish momentum will fully depend on the macroeconomic factors as the markets move on continuous trade tensions between the United States and the rest of the world.
Daily Plan USD/CAD
Questions and answers in Canadian dollars
The main factors that lead the Canadian dollar (CAD) are the level of interest rates set by the Bank of Canada (BOC), the price of oil, the largest export in Canada, the health of its economy, inflation and commercial balance, which is the difference between the value of exports in Canada in exchange for its imports. Other factors include market morale-if investors are eating more risky assets (risk) or searching for safe materials (risk)-with positive CAD risks. As its largest commercial partner, the health of the American economy is also a major factor that affects the Canadian dollar.
Canada Bank (BOC) has a major impact on the Canadian dollar by determining the level of interest rates that banks can persuade each other. This affects the level of interest rates for everyone. The main goal of BOC is to keep inflation by 1-3 % by setting interest rates up or down. Relatively higher interest rates tend to be positive for CAD. Canada Bank can also use quantitative dilution and tighten it to influence credit conditions, with previous CAD negative and the other positive CAD.
The price of oil is a major factor that affects the value of the Canadian dollar. Petroleum is the largest export in Canada, so the price of oil tends to an immediate effect on the CAD value. In general, if the price of oil rises, the CAD rises, with the increased total demand for the currency. The opposite is the case if the price of oil decreases. The high oil prices also tend to increase the possibility of a positive commercial balance, which also supports CAD.
While inflation was always believed to be a negative factor of the currency because it reduces the value of money, the opposite was already the case in the modern era with the relaxation of capitalist controls across the border. Top inflation tends to lead the central banks to raise interest rates that attract more capital flows from global investors looking for a profitable place to keep their money. This increases the demand for the local currency, which in the case of Canada is the Canadian dollar.
Victory of macroeconomic data evaluates the health of the economy and can have an impact on the Canadian dollar. Indicators such as GDP, manufacturing, PMIS, employment services, and consumer morale surveys can affect CAD direction. The strong economy is useful for the Canadian dollar. Not only attracts more foreign investments, but it may encourage Canada Bank to set interest rates, which leads to a stronger currency. If economic data is weak, CAD is likely to fall.
