USD/CAD retreats to 1.31 from highs, looks to snap 2-week losing streak
- Unemployment rate in Canada rises to 5.5% in June from 5.4%.
- US nonfarm payrolls surpass expectations by a wide margin in June.
- USD/CAD pair looks to post small gains for the week.
The USD/CAD pair, which dropped to its lowest level of 2019 at 1.3036 yesterday, staged a decisive rebound on Friday following employment data releases from the U.S. and Canada. After rising all the way up to 1.3035, however, the pair lost its traction and started to consolidate its gains. As of writing, the pair was still up 0.35% on the day at 1.3095, looking to post small weekly gains following two straight weeks with losses.
Statistics Canada today reported that the number of employed in Canada decreased by 2,200 in June and the unemployment rate ticked up to 5.5% from 5.4% to weigh on the demand for the loonie.
On the other hand, the US Dollar Index gained traction after the U.S. Bureau of Labor Statistics announced that nonfarm payrolls in June increased by 224,000 to beat the market expectation of 160,000. Boosted by the data,t he DXY now looks to close the week more than 1% higher. Commenting on the data, "The US labor market is on fire and Federal Reserve officials can sit back and enjoy the fireworks," FXStreet analyst Yohay Elam said.
"While the central bank is set to cut interest rates at the end of the month, the upbeat Non-Farm Payrolls diminish the chances of a deep cut of 50 basis points that investors have wished for."
Technical levels to consider