Ahead of tomorrow’s Canadian growth data the ‘Loonie’ finally received some underlying support and was able to advance on the Pound.
The commodity-driven asset lost ground overnight as the Federal Open Market Committee’s decision to taper stimulus and a less-than-impressive manufacturing figure for China took a toll.
However, the Pound was also feeling the pressure after Bank of England Governor Mark Carney used a press conference in Scotland yesterday to reaffirm the central bank’s commitment to keeping interest rates at record lows for the foreseeable future.
The British currency was little-changed following the release of a report which showed that UK mortgage approvals hit a six-year high but later declined against the ‘Loonie’ after Canadian average weekly earnings data was published.
According to figures compiled by Statistics Canada, average weekly earnings climbed by 2.5 per cent in November, year-on-year, following a positively revised advance of 1.6 per cent in October.
On a monthly basis the average weekly earnings of Canadian non-farm payroll employees advanced by 0.9 per cent.
Eight provinces recorded increased average weekly earnings compared to the same period of 2012.
Alberta enjoyed the most significant surge in wages as ‘earnings in this province were at least 17 per cent higher than those of any other province’.
If tomorrow’s Canadian growth report shows that the nation’s economy expanded by more than the 0.2 per cent month-on-month growth forecast the ‘Loonie’ could extend gains before the weekend.
On the year Canadian GDP is expected to have risen 2.6 per cent in November, down from 2.7 per cent in October.
However, given that Canada has published some concerning employment, housing and inflation data in recent months it seems more likely that the Canadian growth report will deliver a negative surprise, in which case the CAD/USD pairing could plummet to fresh multi-year lows and the GBP/CAD pairing could recover losses.
The UK GfK consumer confidence survey will also be of interest, with sentiment believed to have improved in January.
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,0.5423,
Canadian Dollar,,US Dollar,0.8945 ,
Canadian Dollar,,Euro,0.6596,
Canadian Dollar,,Australian Dollar,1.0183,
Canadian Dollar,,New Zealand Dollar,1.0980 ,
US Dollar,,Canadian Dollar ,1.1181 ,
Pound Sterling,,Canadian Dollar,1.8439,
Euro,,Canadian Dollar,1.5184,
Australian Dollar,,Canadian Dollar,0.9820,
New Zealand Dollar,,Canadian Dollar,0.9161 ,
[/table]
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