When is the Canadian jobs report and how could it affect USD/CAD?

Canadian employment details overview

Statistics Canada is scheduled to publish the monthly jobs report for March later this Thursday at 12:30 GMT. According to the consensus estimates, the Canadian economy is expected to have lost 350K jobs during the reported month. Meanwhile, the unemployment rate is expected to have jumped to 7.2% from 5.6% recorded in the previous month.

How could the data affect USD/CAD?

The recent price action has been driven primarily by two factors – developments surrounding the coronavirus saga and oil price dynamics. Given that the market is already anticipating weaker numbers on the back of the coronavirus crisis, the report seems unlikely to provide any meaningful impetus. Investors might also be reluctant to place any aggressive bets, rather prefer to wait for headlines coming from the OPEC+ meeting on oil output cuts.

Meanwhile, Yohay Elam, FXStreet's own analyst notes: “If Canada loses over a million jobs, the C$ has room to fall in response to the depressing news. If it surprises with a loss of hundreds of thousands of positions, traders will likely conclude that this is only the beginning, and more job losses will come.”

Ahead of the release, the pair was seen trading with a mild positive bias just above mid-1.4000s. Some follow-through buying has the potential to lift the pair beyond the 1.4100 mark, towards testing the 1.4120-25 supply zone. A convincing break through now seems to pave the way for a move back towards reclaiming the 1.4200 round-figure mark.

On the flip side, the key 1.40 psychological mark is likely to protect the immediate downside. Failure to defend the mentioned handle might prompt some aggressive selling and turn the pair vulnerable to accelerate the fall further towards testing sub-1.3900 levels.

Key Notes

  •   Canadian jobs preview: Lose-lose situation for the loonie and two parallel developments to watch

  •   USD/CAD holds steady near mid-1.4000s, focus remains on OPEC+ meeting

  •   USD/CAD: Selling on rallies – OCBC

About the Employment Change

The employment Change released by Statistics Canada is a measure of the change in the number of employed people in Canada. Generally speaking, a rise in this indicator has positive implications for consumer spending which stimulates economic growth. Therefore, a high reading is seen as positive, or bullish for the CAD, while a low reading is seen as negative or bearish.

About the Unemployment Rate

The Unemployment Rate released by Statistics Canada is the number of unemployed workers divided by the total civilian labour force. It is a leading indicator for the Canadian Economy. If the rate is up, it indicates a lack of expansion within the Canadian labour market. As a result, a rise leads to weaken the Canadian economy. Normally, a decrease of the figure is seen as positive (or bullish) for the CAD, while an increase is seen as negative or bearish.