USD/CAD maintains upside pressure above 200-DMA – BBH
USD/CAD remains under upward pressure after breaking above its 200-day moving average at 1.3976. Investors now turn to Canada’s September labor force survey, with expectations for minimal job gains following steep losses in July and August. A disappointing report could increase the likelihood of additional BOC rate cuts, weighing further on the loonie, while swaps currently fully price a 25bps reduction by year-end, BBH FX analysts report.
Canadian jobs report in focus as CAD faces headwinds
"USD/CAD remains under upside pressure after sustaining a break above its 200-day moving average (1.3976). CAD will take its cue today from Canada’s September labor force survey (1:30pm London, 8:30am New York). The Bank of Canada’s (BOC) is increasingly concerned about further weakness in employment conditions."
"The economy is expected to add just 5k jobs in September after shedding -65.5k and -40.8k jobs in August and July, respectively. A poor labor force survey will raise odds the BOC lowers the policy rate below its estimated neutral range of 2.25% to 3.25% and can further weigh on CAD. The swaps market currently fully prices-in a 25bps cut by year-end and the policy rate to bottom at 2.25%."
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FXStreet Insights Team
FXStreet
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