- Canada expected to have gained 12,000 jobs in March.
- Risk sentiment is mildly negative heading into Easter weekend.
- US dollar opens mixed, but little changed from the close.
USDCAD snapshot: open 1.3474-78, overnight range 1.3449-1.3488, close 1.3457, WTI $80.34, Gold $2019.68
The Canadian dollar traded with a negative bias in a quiet overnight session. Traders are looking ahead to this morning’s release of the Labour Force Survey for March. It is expected to show Canada gained 12,000 jobs, even as the unemployment rate ticks higher to 5.1% from 5.0% in February.
Today’s employment result would have to rise substantially above the forecast before analysts would amend their expectations for the Bank of Canada to leave rates unchanged at next week’s meeting.
The Canadian dollar is getting some benefit from the rise in commodity prices this week. West Texas Intermediate (WTI) climbed9.2% from Friday’s low to today’s NY level. The rally was due to Opec and Russia surprising markets by announcing a 1.6 million barrel/day production cut, effective May 1.
Gold prices also soared. XAUUSD rallied from $1950.06 on Monday to $2021.28 today, an increase of 3.5%. The rally is due to recession fears, safe-haven demand, and the steep drop in US Treasury yields. In addition, central banks have been buying gold by the ton, literally. Schiff Gold said central bank gold reserves rose by 52 tons in February, with China accounting for 24.9 tons.
EURUSD traded in a 1.0986-1.0917 range overnight and is at 1.0903 in NY. Prices got a bit of a boost after ECB Chief Economists Philip Lane said that if the projections are on tract by the May meeting, a rate hike would be appropriate.
GBPUSD drifted aimlessly in a 1.2439-1.2486 range. UK house prices were a tad higher in March but did not have much impact.
USDJPY traded in a 130.79-131.49 range. Prices were undermined by lower US Treasury yields which saw the 10-year fall to 3.285% from 3.366% yesterday.
AUDUSD traded narrowly, albeit with a negative bias in a 0.6689-0.6724 range. Mild risk aversion sentiment stemming from the Taiwan President’s meeting with House Speaker Kevin McCarthy weighed on prices. Australia’s Trade Surplus increased to $13.8 billion in February.
NZDUSD fell from 0.6323 to 0.6281by the NY open due to profit-taking after this week’s RBNZ rate-hike fueled gains.
Challenger job cuts and weekly jobless claims data are on tap.
Today’s US data includes Balance of Trade, ADP Employment Change, and ISM Services PMI.
