USD/CAD climbs to fresh multi-month highs above 1.3300 ahead of key jobs data

• WTI erases nearly 1% on Friday as coronavirus fears reemerge. 
• US Dollar Index rises beyond 98.60 ahead of NFP data.
• Unemployment Rate in Canada is expected to stay unchanged at 5.6%.

The USD/CAD tested the 1.3300 handle in the last four days but failed to make a daily close above that level. With the greenback preserving its strength and the poor performance of crude oil prices weighing on the CAD, the pair edged higher and touched its best level since early December at 1.3313. As of writing, the pair was up 0.17% on the day at 1.3306.

Fears over the negative impact of the coronavirus outbreak on the oil demand continue to hurt crude oil prices. Russia’s Energy Minister Alexander Novak on Friday said that the global oil demand could fall by 150,000-200,000 barrels per day in 2020 when compared to the previous year. The barrel of West Texas Intermediate (WTI) was last seen trading at $50.55, losing 1% on a daily basis.

Attention turns to US & Canada labour market data

In the meantime, the persistent USD strength helps the pair preserve its bullish momentum intact. Ahead of the Nonfarm Payrolls (NFP), the US Dollar Index is up 0.12% on the day at 98.60. “We expect a 170k monthly gain for payrolls (consensus is 165k) after 145k in December and a 0.3% rise in hourly earnings in the month, 3.0% YoY,” Westpac analysts said previewing the data.

US NFP Preview: 6 Major Banks expectations for January payrolls report.

The economic docket on Friday will feature the Canadian jobs report as well. Analysts expect the Unemployment Rate to remain unchanged at 5.6% in December.

Technical levels to watch for