Canada: Plenty of upside for data pulse - Westpac

Sandeep Kanihama FXStreet Contributor

The BoC stuck to its clear and already well known script this week – further hikes will be required over time but the Bank will be cautious - yet USD/CAD saw an outsized reaction, notes Richard Franulovich, Research Analyst at Westpac.

Key Quotes

“Suspect markets have overreacted.”

“Encouragingly, key releases have begun to surprise on the upside – GDP, trade and jobs, matching the signals from our very depressed data pulse (i.e. all the bad news is out).”

“Our base case is still intact: risks to both the BoC and consensus projection for 2.1% growth next year are to the upside given Trudeau’s fiscal stimulus is still washing through the economy, US growth prospects are firm and oil prices are at 2 ½ year highs.”

“1.30 should offer stiff resistance on the topside and the BoC could easily deliver at least +50bp in hikes in H1 next year, more than what is priced in.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

EUR/USD faces next resistance near 1.1930

EUR/USD has surrendered its earlier intraday advance on Thursday and is now hovering uncomfortably around the 1.1860 region amid modest gains in the US Dolla. Moving forward, markets are exoected to closely follow Friday’s release of US CPI data.

GBP/USD inching closer to 1.36

The Pound Sterling edged higher to 1.3640 on Thursday, recovering from an earlier pullback after stronger-than-expected US jobs data initially weighed on the pair. The Bank of England held rates at 3.75% at its February 4 meeting in a narrow 5-4 vote split, with four members preferring a 25 basis point cut to 3.50%.

Gold falls to near $4,900 as selling pressure intensifies

Gold price faces some selling pressure around $4,910 during the early Asian session on Friday. The yellow metal tumbles over 3.50% on the day, with algorithmic traders appearing to amplify the precious metal’s sudden drop. Traders will closely monitor the release of the US Consumer Price Index inflation report for January, which will be released later on Friday.

Ethereum investors face huge unrealized losses following price slump

US spot Ethereum exchange-traded funds flipped negative again on Wednesday after recording net outflows of $129.1 million, reversing mild inflows seen at the beginning of the week, per SoSoValue data. Fidelity's FETH was responsible for more than half of withdrawals, posting outflows of $67 million.

A tale of two labour markets: Headline strength masks underlying weakness

Undoubtedly, yesterday’s delayed US January jobs report delivered a strong headline – one that surpassed most estimates. However, optimism quickly faded amid sobering benchmark revisions.

Aster Price Forecast: Demand sparks on Binance Wallet partnership for on-chain perpetuals

Aster is up roughly 9% so far on Thursday, hinting at the breakout of a crucial resistance level. Aster partners up with Binance wallet for the second season of the on-chain perpetuals challenge.