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 August later this Friday at 12:30 GMT. According to the consensus estimates, the number of employed people is expected to have risen by 15K during the reported month as compared to a sharp fall of 24.2K in the previous month, while the unemployment rate is expected to hold steady at 5.7%.
Analysts at TD Securities also forecast the creation of 15K jobs in August and explained - “Details should prove upbeat with a partial recovery in private employment while wage growth is projected to push even higher to 4.7% y/y (market: 4.5%) due in part to base-effects. Lastly, our forecast has the unemployment rate edging lower to 5.6%, helped by modest labour force growth during August.”
How could the data affect USD/CAD?
Ahead of the key release, the pair managed to defend 50-day SMA support and was placed in the neutral territory - around the 1.3225-30 region. Barring any knee-jerk reaction any major divergence from the expected readings, the report is likely to be overshadowed by the US monthly jobs report (NFP) and seems unlikely to be a major game-changer for the major.
However, surprisingly positive reading might be enough to provide a goodish lift to the Canadian Dollar and drag the pair decisively below the 50-day SMA towards testing its next major support near mid-1.3100s. On the flip side, bulls are likely to confront some resistance near the 1.3250-60 region, above which the pair seems all set to aim back towards reclaiming the 1.3300 handle.
Key Notes
• Canadian jobs preview: Low expectations and upbeat mood imply win-win situation for CAD
• USD/CAD fails to extend bounce off 50-DMA ahead of US, Canadian job numbers
• USD/CAD Intraday: Bullish bias above 1.3215
About the Employment Change
The employment Change released by the 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 the Statistics Canada is the number of unemployed workers divided by the total civilian labor force. It is a leading indicator for the Canadian Economy. If the rate is up, it indicates a lack of expansion within the Canadian labor 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.