USDCAD strength declines as a bearish outlook is in view. The US dollar is believed to be among the currencies influencing the world due to it being one of the largest economies. Its total share is close to 24% of the global GDP. A slight change in it is also causing a major impact on the USDCAD market. Ever since the US Federal Reserve showed indications of reducing rate hikes, the US dollar has appeared to be declining. Unlike their action of increasing the interest rate hike, which has brought about great upkeep for the dollar index against its contemporaries.
Canadian Employment Report Impacts USDCAD
The USDCAD slowly makes its plunge following its buy signal stationed close to the 1.3800 key zone, thereby making about a 2.6% fall. Adding to the Canadian employment data report, the US jobs data report appears to be mixed. However, a further increase in the unemployment rate could hinder the interest rate from rising aggressively at the moment.
Based on October’s U.S. employment data, the report shows that major investors were not putting their attention on the headline number, which makes us see the fact that new jobs close to 260k were added to boost the economy. Nevertheless, the unemployment rate has moved beyond its estimated rate, which is 3.6% to 3.7%.
The Canadian report goes beyond expectations following the addition of up to 106k jobs to the labor market. The average hourly rate makes its spike by 5.5% above the previous month, unlike in the US, where the average hourly earnings decline from 5% to 4.8% in the previous month. If the US dollar continues to weaken, it could still be a solid advantage for the loonie to trend upward as we hope for economic recovery and as China is still working on easing COVID-19 restrictions.
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