The Canadian Dollar continues to advance heading into the end of the trading week.
New hiring in Canada exceeded market expectations, but the unemployment rate rose slightly.
Canadian wage growth remains at 5%.
He Canadian dollar (CAD) advances strongly in Friday’s session against the US dollar (USD), after Canadian employment figures exceeded market expectations. The Canadian dollar is one of the best performing currencies of the week, having gained one percentage point against the US dollar since Monday’s opening bids.
In November, Canada created almost twice as many jobs as predicted by the median market forecast, with almost 25,000 new hires compared to the 15,000 expected, an increase in the pace of new job creation since the 17,500 in October.
The Canadian unemployment rate rose slightly to 5.8%, in line with investor expectations, and the average hourly wage for the year through November held steady at 5% in October, helping to ease concerns about demand-driven inflation as Canadian wage growth remains limited below 6%.
Daily summary of market movements: The Canadian dollar is advancing again against the US dollar and is approaching 1.3500.
- The Canadian dollar rose three tenths against the US dollar on Friday.
- Canada added 24,900 jobs in November compared to 17,500 previously, beating expectations for an impression of 15,000.
- Despite beating market forecasts, Canadian hiring remains below the 2023 peak impression of 150,000 in February.
- The supremacy of the CAD is limited by a slight decline in the Canadian S&P global manufacturing Purchasing Managers’ Index (PMI), which fell from 48.6 to 47.7 points.
- The Canadian unemployment rate rose slightly from 5.7% to 5.8%, but this figure was widely anticipated by markets.
- The Canadian dollar has yet to recover from Thursday’s decline in Gross Domestic Product (GDP), after quarterly GDP unexpectedly fell 1.1% in the third quarter. Instead, investors are focused on the extreme upward revision to second-quarter GDP growth, from -0.2% to 1.4%.
- Crude oil markets are as volatile as ever, but continue to swing as fossil fuel investor sentiment plays tug-of-war between declining global demand and concerns of a new batch from the Organization of the Petroleum Exporting Countries (OPEC). Crude oil production cuts set to continue through the first quarter of 2024.
Current CAD quote
The following table shows the percentage change of the Canadian Dollar (CAD) against the currencies listed today. The Canadian Dollar was the strongest currency against the Euro.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | 0.12% | -0.45% | -0.50% | -0.87% | -0.75% | -0.65% | -0.51% | |
| EUR | -0.12% | -0.60% | -0.65% | -1.04% | -0.91% | -0.80% | -0.61% | |
| GBP | 0.45% | 0.58% | -0.05% | -0.41% | -0.29% | -0.20% | -0.05% | |
| CAD | 0.50% | 0.64% | 0.06% | -0.40% | -0.24% | -0.14% | 0.04% | |
| AUD | 0.86% | 1.03% | 0.45% | 0.40% | 0.14% | 0.24% | 0.42% | |
| JPY | 0.74% | 0.93% | 0.32% | 0.24% | -0.11% | 0.14% | 0.29% | |
| NZD | 0.65% | 0.80% | 0.21% | 0.15% | -0.24% | -0.10% | 0.18% | |
| CHF | 0.47% | 0.59% | 0.03% | -0.03% | -0.39% | -0.27% | -0.18% |
The map shows the percentage changes of the major currencies against each other. The base currency is chosen in the left column, while the quote currency is chosen in the top row. For example, if you choose the euro in the left column and scroll down the horizontal line to the Japanese yen, the percentage change in the box will represent EUR (base)/JPY (quote).
Technical Analysis: The Canadian Dollar advances another day against the US Dollar
The Canadian Dollar (CAD) continued its rally against the US Dollar (USD) on Friday, sending USD/CAD to the 1.3500 zone in Friday trading, and the pair is currently trapped at the simple moving average (SMA). 200 days near 1.3520.
The Canadian dollar has risen against the US dollar for four of the last five consecutive sessions, and the USD/CAD pair is on track to close Friday’s trading with another day lower, as the pair trades at eight-day lows. weeks.
With USD/CAD down almost 3% from the high reached in early November in the 1.3900 area, technical indicators have accelerated firmly into oversold territory. The 14-day Relative Strength Index (RSI) is testing the oversold lower boundary, and the moving average convergence-divergence (MACD) signal line has turned into negative territory.
USD/CAD Hourly Chart
USD/CAD Daily Chart
Frequently Asked Questions about the Canadian Dollar
What factors determine the price of the Canadian dollar?
The key factors that determine the price of the Canadian dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of oil, Canada’s main export product, the health of its economy, inflation and the trade balance, which is the difference between the value of Canadian exports and its imports. Other factors are market confidence, that is, whether investors bet on riskier assets (risk-on) or look for safe assets (risk-off), with the risk-on being positive for the CAD. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian dollar.
How do Bank of Canada decisions affect the Canadian dollar?
The Bank of Canada (BoC) exerts significant influence over the Canadian Dollar by setting the level of interest rates that banks can lend to each other. This influences the level of interest rates for everyone. The BoC’s main objective is to keep inflation between 1% and 3% by adjusting interest rates up or down. Relatively high interest rates are usually positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former being negative for the CAD and the latter being positive for the CAD.
How does the price of oil affect the Canadian dollar?
The price of oil is a key factor influencing the value of the Canadian Dollar. Oil is Canada’s largest export, so the price of oil tends to have an immediate impact on the value of the CAD. Generally, if the price of oil rises, the CAD also rises, as aggregate demand for the currency increases. The opposite occurs if the price of oil falls. Higher oil prices also tend to lead to a higher probability of a positive trade balance, which also supports the CAD.
How does inflation data influence the value of the Canadian Dollar?
Although inflation has traditionally always been considered a negative factor for a currency, as it reduces the value of money, the opposite has actually happened in modern times, with the relaxation of cross-border capital controls. Higher inflation often leads central banks to raise interest rates, attracting more capital inflows from global investors looking for a lucrative place to store their money. This increases the demand for the local currency, which in the case of Canada is the Canadian Dollar.
How does economic data influence the value of the Canadian dollar?
The published macroeconomic data measures the health of the economy and may have an impact on the Canadian dollar. Indicators such as GDP, manufacturing and services PMIs, employment and consumer confidence surveys can influence the direction of the CAD. A strong economy is good for the Canadian dollar. Not only does it attract more foreign investment, but it may encourage the Bank of Canada to raise interest rates, resulting in a stronger currency. However, if economic data is weak, the CAD is likely to fall.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
