Canada is sporting a busy data calendar this week! How can these events affect the Loonie’s price action?
Trade balance (Sept. 4, 1:30 pm GMT)
Canada’s trade surplus narrowed down from a downwardly revised 0.56B CAD to 0.14B CAD in June. It was lower than the 0.3B CAD figure that analysts were expecting, and it was the third surplus since December 2016.
Apparently, exports dipped by 5.1% during the month while imports also slid by 4.3%. The Loonie fell against its major counterparts at the time of the release but eventually recovered its intraday losses later in the trading session.
This week market players see Canada clocking in a 0.40B trade DEFICIT for the month of July as imports outpace exports.
Before you draw your trading plans around this specific event, you should know that there’s another major data release during the same trading session…
BOC’s policy statement (Sept. 4, 3:00 pm GMT)
You read that right! On Wednesday during the U.S. session the Bank of Canada (BOC) will print its monetary policy decision for the month of September.
For those who have just tuned in, know that central banks of commodity-producing countries like Australia and New Zealand have already slashed their interest rates left and right to accommodate trade war and global demand slowdown risks. This upped the pressure on BOC to follow suit.
Last month’s semi-dovish statement doesn’t help. If you recall, Governor Poloz and his team were already concerned enough about the impact of global trade tensions that the Loonie fell after the last BOC statement.
Analysts aren’t exactly calling for BOC to cut rates this month. However, everyone and his momma will be waiting to see if BOC members have more to be concerned about this month and possibly consider a rate cut in the foreseeable future.
Employment data (Sept. 6, 1:30 pm GMT)
It’s NFP week Canada-style! On Friday we’ll see if Canada’s job market still points to strong domestic consumption that will continue to ease pressure on the BOC to ease its rates.
Last month’s release was shaky af as we saw the economy lose a net of 24,200 jobs in July. The unemployment rate also ticked higher from 5.5% to 5.7% as labour force participation rate dipped from 65.7% to 65.6% for the month.
Luckily for Loonie bulls, there were other catalysts that pushed the comdoll around the charts during the release.
This week expect to see the economy add a net of 15,000 jobs for the month of August. Unemployment rate is also expected to remain at 5.7% even as participation rate ticks higher to 65.7%.
Note that the report will come out at the same time as the U.S. NFP report. That means y’all gotta watch out in case Uncle Sam’s numbers affect the Loonie’s price action more than Canada’s data release does!
Missed last week’s price action? Read CAD’s price recap for August 26 – 30!