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There is a good case for Canada’s job figures to have beaten estimates in January and the loonie has room to rise. However, US Nonfarm Payrolls may prompt choppy price action, Yohay Elam, an Analyst at FXStreet, reports.

Key quotes

“The economic calendar is pointing to a loss of 47,500 positions in January, following a 62,600 decrease in December.”

“An upbeat jobs report may boost the loonie and also unleash more gains related to rising oil prices. The C$ has yet to respond to the gradual increase in crude, a result of high compliance by OPEC+ members and optimism about the impact of vaccines on the global economy. CAD could climb now, in a belated response. “

“It is essential to note that US NFP is published at the same time and could lead to choppy price action in the dollar. On the one hand, upbeat employment figures may boost the dollar as they imply stronger US growth and push the Federal Reserve to tighter monetary policy. On the other hand, they could curb the enthusiasm in Washington for further stimulus. The same considerations are in play in the case of a downbeat NFP, which would equally trigger a choppy reaction.”