Though below consensus, economists at TD Securities think the CAD will welcome a good jobs report in the absolute sense. They also think that markets will be keen to hear what Governor Macklem has to say next week, which might help USD/CAD to find a home between 200-DMA at 1.35 and daily downtrend resistance near 1.3620/30.
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Key quotes
“Our bias is that the CAD will be satisfied with a solid jobs number even if it comes in below expectations. We think the CAD could reflect concern if we see a substantial disappointment, perhaps below 500k. Ultimately, the data will need to be taken in conjunction with the tone in risk sentiment however, as that remains the dominant factor.”
“We are mindful that markets may be keen to see what Governor Macklem has to say next week. For this reason, USD/CAD might still find a home between the 200-dma at 1.35 and daily downtrend resistance near 1.3630. A very large upside surprise would risk a re-test of the June lows near 1.33.”
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