Although the Pound experienced limited movement following the publication of fairly mixed UK data, the British currency went on to decline against a buoyed ‘Loonie’ during North American trading.
The Canadian Dollar advanced on rivals like the Pound as Canada’s jobs report surpassed expectations, lessening the odds of the Bank of Canada introducing a rate cut in the near future.
Canada added 29,400 positions in January, more than the 20,000 predicted. December’s employment slide was positively revised to a loss of 44,000 positions.
The Canadian unemployment rate unexpectedly declined from 7.1 per cent to 7.0 per cent, although the participation rate did slip to 66.3 (its lowest level since 2002) rather than holding at 66.4 as expected.
20,000 people leaving the Canadian workforce was a big contributor to the decline in the nation’s unemployment rate.
The surprisingly upbeat figures saw the Canadian Dollar advance, and in the opinion of economist Paul Ferley, the figures suggest ‘there’s not bad momentum in the economy, sufficient to keep pushing the unemployment rate down and that should push inflation higher. It’s not the kind of environment where the Bank of Canada needs to cut rates’.
While the Canadian Dollar advanced on the Pound it also surged by 0.6 per cent on the US Dollar, aided by some disappointing US employment figures.
The GBP/CAD pairing could experience further movement before the close of European trading as the UK NIESR GDP estimate for January is published.
Next week ‘Loonie’ movement could be inspired by the domestic new housing price index and Canada’s manufacturing sales report.
Canadian Dollar (CAD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Canadian Dollar,
,Pound Sterling,0.5556,
Canadian Dollar,,US Dollar,0.9042,
Canadian Dollar,,Euro,0.6684,
Canadian Dollar,,Australian Dollar,1.0119,
Canadian Dollar,,New Zealand Dollar,1.0918 ,
US Dollar,,Canadian Dollar ,1.1062 ,
Pound Sterling,,Canadian Dollar,1.8074,
Euro,,Canadian Dollar,1.5009,
Australian Dollar,,Canadian Dollar,0.9883,
New Zealand Dollar,,Canadian Dollar,0.9116 ,
[/table]
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