Home USD/CAD Parity Gets Closer As Canada Loses Jobs
Forex News Today: Daily Trading News

USD/CAD Parity Gets Closer As Canada Loses Jobs

The Canadian job market surprisingly lost 5500 jobs in August. Expectations were much higher – for a gain of 24.2K. The unemployment rate ticked up from 7.2% to 7.3% as expected. USD/CAD is now moving higher, with parity getting closer.

This follows the disappointment seen last month, when Canada gained only 7.1K jobs. The months beforehand were much better, with nice gains.

The US weakness is definitely hitting its northern neighbor. Canada is very dependent on demand from the US, which also disappointed in the recent Non-Farm Payrolls report. This dependence is stronger than the dependence on oil prices.

Canada has a benchmark interest rate of 1%. The chances of a rate cut in 2011 already rose after the recent pessimistic statement in the rate decision. They are now even more elevated.

USD/CAD is currently at 0.9950. The next line of resistance is at 0.9973, just under the very round number of 1 – parity. Above parity we have 1.0060. Minor support is at 0.9913, followed by 0.9850. For more on USD/CAD, see the  Canadian dollar forecast.

Another factor pushing the pair higher is the general dollar strength across the board. The European troubles have their share in this. Trichet’s pessimistic press conference and the troubles in Greece already pushed EUR/USD to a 6 month low.

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.