The Canadian dollar has posted slight losses on Friday, as USD/CAD trades in the mid-1.09 range late in the session. In economic news, Canadian Employment Change posted a gain of just 0.2 thousand, well short of expectations. The unemployment rate edged lower, to 7.0%. In the US, there are no major releases on today's schedule.
Canada wrapped up the week with disappointing employment numbers, as Employment Change came in almost flat, at just 0.2 thousand. This surprised the markets, which had expected a strong gain of 25.4 thousand. The indicator tends to show sharp swings, which often results in estimates that are well off the mark. There was better news from the unemployment rate, which dipped to 7.0%, down from 7.1%. This matched the forecast.
South of the border, US Unemployment Claims improved, dipping below the 300 thousand level last week. The key indicator dropped to 289 thousand, beating the estimate of 305 thousand. The four-week claims average, which is less volatile than the weekly count, dipped to 293,500, its lowest level since February 2006. The stronger numbers point to increased hiring in response to stronger demand, which in turn has contributed to gains in income and stronger consumer spending. An improving job market is critical for economic growth, and the dollar has gained broad strength as key US data points upwards.
Canadian numbers were sharp on Thursday, led by Building Permits which posted a strong gain of 13.5% last month. This figure was close to the previous release of 13.8%, and crushed the forecast of -1.8%. Building Permits is an important gauge of the strength of the construction sector, and the markets will be hoping that Housing Starts, which will be released on Monday, follows suit with a strong showing. There was excellent news from Canadian Ivey PMI, which climbed to 54.1 points, matching the forecast. This was up sharply from 46.9 points a month earlier. The PMI pushed above the 50 line, which marks expansion, for the first time since April.
USD/CAD 1.0966 H: 1.0967 L: 1.0910
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