The week has started with little fanfare. On the fundamental front, there are no Canadian events. In the U.S., the sole indicator is the Federal budget balance. On Tuesday, the U.S. releases consumer inflation, the primary gauge of consumer inflation.
Canada Employment Jumps, Loonie Shrugs
The week ended with key employment numbers. The economy created 952,900 jobs in June, up sharply from 289,600 beforehand. The unemployment rate fell to 12.3%, down from 13.7%. However, this figure was above the estimate of 12.0%.
Despite the rosy job creation numbers, the Canadian dollar was almost unchanged on Friday. The Canadian dollar hasn’t been able to capitalize on the risk appetite we’re seeing on the part of investors – the Australian dollar, for example, put together a double-digit rally in the second quarter. Canada’s economy is very dependent on the giant U.S. economy, which accounts for 70% of Canadian exports. Policy-makers are hoping that the recovery in the U.S. will pick up speed, which would be good news for Canada’s economy as well as the Canadian dollar.
USD/CAD Technical
USD/CAD has kicked off the week with slight gains. The pair is currently trading at 1.3554, down 0.27%. In the Asian session, the pair recorded slight losses and levelled off in the European and North American sessions.
- 1.3545 is fluid. Currently, it is a weak support level. The next support level is at 1.3514
- 1.3571 is the next resistance line, followed by resistance at 1.3628
- The 20-day MA follows immediately, at 1.3572.
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