The BOC is up this week!
What are analysts expecting from the event and which potential catalysts can move the Loonie?
I’ve got a list!
BOC’s statement (June 3, 2:00 pm GMT)
- In mid-April Bank of Canada (BOC) maintained its 0.25% interest rates and introduced tens of billions worth of market operations
- CAD paused from its losses at the time, though it wasn’t until the next day when it found its intraweek bottom
- Analysts don’t expect policy changes from BOC this week
- It’s Poloz’ last stint as Governor before he gets replaced by Tiff Macklem. Watch out for hints of his policy biases
Labor market reports (June 5, 12:30 pm GMT)
- Canada shed a record 1.99 million jobs in April, double the 1 million job losses in March
- Unemployment rate jumped from 7.8% to 13.0% while participation rate dropped from 63.5% to 59.8%
- CAD still maintained its intraday gains thanks to vaccine and reopening of economy prospects
- Canada is printing labor market numbers AT THE SAME TIME as the U.S. NFP reports
- Another 500,000 workers may have lost jobs in May
- Analysts see the jobless rate rocketing to 15% in May
- The IVEY PMI (June 5, 2:00 pm GMT), which is usually a leading indicator, is printed after the official numbers
Market risk sentiment
- Pandemic headlines (end of lockdown measures, vaccine prospects, stimulus programs) will continue to affect risk taking in the markets
- Resumption of economic activities could improve demand for oil (and oil-related CAD)
- Top-tier reports (RBA and ECB decisions, PMI reports, NFP numbers) can influence risk appetite during their releases
- Stochastic sees the Loonie as “overbought” against the dollar and yen
- CAD might be “oversold” against its fellow comdolls on the daily
- Bollinger Band traders should watch the Loonie’s “oversold” against the Aussie
- 50 and 200 SMAs suggest that the Loonie’s bearish trends might be weakening on the daily chart
- CAD was most volatile against AUD, JPY, CHF, and USD in the last seven days
Missed last week’s price action? Read CAD’s price recap for May 25 – 29!