Will Loonie bears extend their momentum? Take a look at the catalysts that can affect the comdoll’s price action this week!
Trade balance (June 6, 1:30 pm GMT)
Canada’s trade deficit narrowed down for a third month in a row in March. It clocked in at 3.21B CAD when analysts had expected a 2.45B CAD gap after February’s numbers came in at 3.42B CAD.
Unfortunately for the Loonie, market players had been focusing on mixed (but mostly lower) crude oil prices at the time.
This week analysts expect to see the deficit to narrow further to 2.80B CAD in April.
Before you put all your bets on the report, though, you should note that the IVEY PMI report will also be printed just two hours after the trade balance release.
IVEY PMI (June 6, 3:00 pm GMT)
For newbies out there, you should know that traders watch the IVEY PMI report closely because it’s one of the more reliable leading indicators for Canada’s economy.
Last month’s release showed the index rising from 54.3 to 55.9, with the employment and inventories weakening while deliveries and prices inched higher.
The better-than-expected figures pushed the Loonie a bit higher against some of its counterparts, though it also gave up its gains almost as soon as the session ended.
This week market geeks expect more improvement from the report. Specifically, it’s expected to rise to 56.2 after last month’s 55.9 reading.
No Canadian report will follow the IVEY PMI release, so it’s possible for the Loonie to sustain its reaction to positive or negative surprises. Of course, that’s IF there are no larger economic themes in play!
Labor market reports (June 7, 1:30 pm GMT)
As you can see from last month’s chart, Canada’s labor market report was the only release that managed to buck the Loonie’s downtrend.
And why not? For one thing, April’s numbers showed the unemployment rate falling from 5.8% to 5.7% when analysts saw it maintaining its 5.8% reading.
The economy also added a net of 106,500 jobs, which marked the largest increase of all time. OF ALL TIME! A closer look reflected part-time employment rising by 33,600 while 73,000 full-time workers found jobs for the month.
This week analysts expect the report to take a chill pill and only reflect a 9,000 net job addition. Meanwhile, unemployment rate is expected to maintain its 5.7% rate even as labor force participation rate is seen to weaken from 65.9% to 65.8%.
Take note that Canada’s job numbers will be published at the same time as Uncle Sam’s. That means you gotta pay attention to both if you want to speculate on the Loonie’s price action!
Missed last week’s price action? Read CAD’s price recap for (May 27 -31)!