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Rising Oil Prices Could Elevate Value Of Loonie

Published 2017-11-06, 10:30 a/m
Updated 2017-05-14, 06:45 a/m

The U.S. economy continues to churn out jobs at an impressive pace: +261,000 in October, although that reading is slightly below expectations (313,000). The previous month, which was strongly impacted by hurricanes, was revised upward by +51,000. Wage growth continues to disappoint.

Closer to home, the reading was just as impressive +35,000 jobs (+88,000 full-time and -53,000 part-time) after September had seen +112,000 full-time positions! Canada has generated 308,000 jobs over the past 12 months.

The USD ended trading on Friday at a high against the EUR, but not against the CAD. Although a December rate cut still does not appear to be in the cards in Canada, Bank of Canada Governor Stephen Poloz will have to act in 2018 given a very vigorous job market and economy.

There is little in the way of major indicators on the calendar this week. The risk for USD sellers could be that markets take another look at crude oil prices (WTI), which have broken through important technical levels and now sit above $55 a barrel. The CAD could then rapidly regain its lost value.

Olivier Cosialls

Range of the day: 1.2700 – 1.2800

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