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 November later this Friday at 13:30 GMT. According to the consensus estimates, the Canadian economy is expected to have added 20K jobs during the reported month as compared to October's rise of 83.6K. Meanwhile, the unemployment rate is expected to hold steady at 8.9%.
As Yohay Elam, FXStreet's own Analyst explains: "The virus alone is one reason to doubt a faster increase in employment rather than a slowdown. Another reason to lower expectations stems from the reduced pace of the recovery. Job restoration was initially quick in the summer, but now, the low hanging fruit is gone, with further expansion of the employment market likely to be much slower – in Canada and everywhere else."
How could the data affect USD/CAD?
The simultaneous release of the closely-watched US NFP report is likely to overshadow the Canadian employment details. That said, any significant divergence from the expected figures might still produce some meaningful trading opportunities around the USD/CAD pair. Ahead of the key data, the pair was seen consolidating its recent fall to the lowest level since October 2018, around mid-1.2800s.
Any disappointment is likely to be offset by the prevalent selling bias surrounding the US dollar and bullish crude oil prices, which tend to underpin the commodity-linked currency – the loonie. Conversely, a stronger-than-expected reading should provide an additional boost to the Canadian dollar. Hence, the path of least resistance remains on the downside and the pair seems more likely to prolong its recent bearish trajectory.
In the meantime, immediate support is pegged near the 1.2835 region, below which the pair would turn vulnerable to break below the 1.2800 mark. The pair might then accelerate the fall towards October monthly swing lows, around the 1.2785-80 region. On the flip side, any attempted recovery move is more likely to fizzle out rather quickly and remain capped near the 1.2900-10 resistance zone.
Key Notes
• Canadian Jobs Preview: Why expectations may be too high and the loonie could suffer
• USD/CAD at heavy support and ready for the next bear rally
• USD/CAD struggles near 1.2860-50 region, US/Canadian jobs report awaited
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.