Surprisingly strong labour market to support the Loonie – Commerzbank

FXStreet Insights Team FXStreet

Today, the Bank of Canada will gain further important insight for next week’s rate decision with the labour market report for November. If the data surprises on the upside, the Loonie could surge higher, economists at Commerzbank report.

Continued constraints on the labour market?

“If today’s data remains within the framework of expectations (unemployment rate 5.3%; employment +10K) it should not impress the Loonie much. With a view to the BoC meeting next week the market seems to be expecting a smaller rate step of 25 bps.”

“The analysts polled by Bloomberg are divided. Whereas one half also expects BoC to switch down a gear, the other half expects it to hike its key rate by a further 50 bps. Against this background, a surprisingly strong labour market might well drive rate expectations up again, which would support the Loonie.”

See – Canadian Jobs Preview: Forecasts from five major banks, more lackluster performance

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

EUR/USD flat lines below 1.1900; divergent Fed-ECB expectations offer support

The EUR/USD pair struggles to capitalize on the overnight bounce from the 1.1835-1.1830 region and oscillates in a narrow band during the Asian session on Thursday. Spot prices currently trade around the 1.1875 area, remaining nearly unchanged for the day and staying within striking distance of an over one-week high, reached on Tuesday, amid mixed cues.

GBP/USD slips heading into the Thursday trading window

The Pound Sterling pulled back from four-year highs on Wednesday, weighed down by a combination of Bank of England dovishness and UK political uncertainty, even as the US Dollar weakened on soft labor market revisions.

Gold holds losses near $5,050 despite renewed USD selling

Gold price trades in negative territory near $5,050 in Thursday's Asian session. The precious metal faces headwinds from stronger-than-expected US employment data, even as the US Dollar sees a bout of fresh selling. All eyes now remain on the next batch of US labor statistics.

Crypto trades through a confidence reset

The cryptocurrency market is navigating a liquidity-driven reset rather than a narrative-driven rally. Bitcoin, Ethereum and major altcoins remain under pressure even as new exchange-traded fund filings continue and selected inflow days appear on the tape.

The market trades the path not the past

The payroll number did not just beat. It reset the tone. 130,000 vs. 65,000 expected, with a 35,000 whisper. 79 of 80 economists leaning the wrong way. Unemployment and underemployment are edging lower. For all the statistical fog around birth-death adjustments and seasonal quirks, the core message was unmistakable. The labour market is not cracking.

XRP sell-off deepens amid weak retail interest, risk-off sentiment

Ripple (XRP) is edging lower around $1.36 at the time of writing on Wednesday, weighed down by low retail interest and macroeconomic uncertainty, which is accelerating risk-off sentiment.