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Looking to trade the Loonie this week? You might catch some volatility right around the release of Canada’s jobs report this October 11, 1:30 pm GMT.

Here’s what you should know if you’re planning on catching pips from the event:

What happened last time?

  • August employment up by 81.1K vs. 18.9K forecast, -24.2K previous
  • August unemployment rate steady at 5.7%

After a couple of months of seeing weaker than expected negative readings, Canada’s labor market staged quite the rebound in August with an impressive 81.1K gain in hiring.

This was waaay stronger than the projected 18.9K increase and more than enough to make up for the earlier 24.2K decline. However, this was mostly spurred by a jump in part-time employment and the jobless rate still held steady at 5.7% as expected.

Components of the August jobs report revealed that this was mostly due to an increase in the labor force participation rate from 65.6% to 65.8%, which means that more folks returned to the jobs market to look for work.

Overlay of CAD Pairs: 15-min Forex Charts
Overlay of CAD Pairs: 15-min Forex Charts

The Canadian dollar popped higher against most of its counterparts, most noticeably against the Greenback, when the actual numbers were printed. Of course it’s also worth noting that, at that time, the U.S. economy printed weaker than expected NFP results.

What are traders expecting this time?

  • September employment change of 11.2K
  • No change in jobless rate of 5.7%

A slower pace of hiring is expected for the previous month at 11.2K, which might be enough to keep the jobless rate steady at 5.7%.

The Ivey PMI supports this weaker employment outlook as the reading slipped from 60.6 all the way down to 48.7 to reflect industry contraction. Its employment gauge tumbled from 52.7 to 49.6 in September, hinting that a huge slowdown took place.

Trading Tips

With most major central banks shifting to easing mode these days, it won’t be surprising to see Loonie traders treating the upcoming jobs report as an omen for future BOC moves.

In particular, much weaker than expected results could spark rate cut expectations, even though BOC officials have been sitting on their hands for the past seven months.

Still deciding which currency to trade against the Loonie? Check out this MarketMilk™ performance ranking of CAD pairs to help you gauge which might be the strongest bullish or bearish rivals:

CAD Pairs Bullish Bearish

Not feeling confident about trading the event at all? That’s okay, you can always stay in the sidelines and observe the Loonie’s reaction to the release.