Forex Outlook: Canadian Dollar Slips Down On Weak Job Data

The Canadian dollar slumped down the most in seven weeks. Investors expect that in order to support economic growth, the Bank of Canada might decrease the interest rates

The Loonie, as the Canadian dollar is named for the image of the aquatic bird on the C$1 coin, slipped down after almost hovering near the strongest level versus the greenback, the U.S.dollar. This was influenced by the fall in the employment rate by 28,900 in April, as reported by the Statistics Canada.

The Canadian dollar slid down by 0.6 % to C$1.0898 against the U.S. dollar at 5 p.m. in Toronto after moving down by 0.8 %, the major drop from the time of 19th March. The decline pared the currency’s second weekly gain to 0.7 percent. The Canadian dollar ascended on May 9 to the strongest level at $1.0814, since 8th Jan. .

Data from a survey taken from economists predicts that the Canadian dollar will slide down to C$1.13 for the year-end while it will bounce back to C$1.11 at the end of 2015.

Forex Trading: Greenback Surges Up Against The Yen

The greenback made a comeback against the yen as data predicts a fall in jobless claims and an increase in hiring in April. More support was drawn to the greenback with the expectations of positive U.S. data on consumer spending and manufacturing growth.

The positive Chinese data for April showing better PMI readings facilitated a two-day gain by the Australian dollar. The dollar traded at 102.29 against the yen as of 1:02 p.m. in Tokyo. This was high from yesterday level of 102.24, when it moved down by 0.4 %.

Against the euro, the dollar kept steady at 1.3870 after decreasing by 0.4 % in New York. The yen also kept steady against the euro and traded at 141.88 per euro. Markets in China, Hong Kong, Singapore, South Korea and Switzerland will remain closed due to public holiday on May 1.

Forex Outlook: A snap View On The U.S. Economy

Data on 17th of April revealed an increase in the Philadelphia Fed’s factory index to 16.6 in April, which analysts state that it is the highest since September. A report from the Labor Department revealed a lower jobless claims in April, with the jobless claims at 304,000 till April 12th, which was the lowest since September 2007.

Another report by Intercontinental Exchange Inc. showed positive speculation on the greenback. The Dollar Index, a comparison of the greenback against six major trading partners of U.S., was little changed at 79.852, with expectations of a 0.5 % increase this week.

 With the positive sentiment boosted by the improved climate, US consumer confidence has surged up from a nine-week low. Along with the optimistic employment prospects, this has boosted the economy.

Consumer spending in the spring is expected to rise with the higher wages. The retail sales saw an uptrend in March, the highest since September 2012. Official data revealed a hike in retail revenues by 1.1 %.

The Ward’s Automotive Group states that the automobile sales moved up at the fastest annualized rate since May 2007.

Forex Outlook: The Greenback Strengthens Against The Major Peers

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The dollar strengthened versus most of its major peers. The dollar seems to be a safe haven for investors amid tension in Ukraine. Expectations are high on today’s speech by the Federal Reserve Chair Janet Yellen.

In the wake of the deadly clashes in Ukraine, the U.S. and European Union may consider more sanctions against Russia, fueling more appeal for the greenback. With the data revealing slightly higher than expected growth data on China, the Australia’s dollar was steady and wiped off the earlier losses. The yen moved down as Japanese stocks moved up higher. After inflation slowed and dairy prices fell, the New Zealand’s dollar fell down for the second day.

The U.S. currency moved up 0.3 % to 102.19 against the yen. The dollar moved little against the euro and stayed at $1.3818, a 0.5 % increase this week. Against the greenback, the Aussie bounced back from its earlier fall of 0.3 % to retain at 93.64 U.S. cents. New Zealand’s dollar weakened against the greenback and moved down by 0.6 % to 85.88 U.S. cents.

Forex Outlook: Investors Keen On US Fed Speech

With little or no events to drive the New Zealand Dollar, there was more profit-booking for the New Zealand Dollar. The kiwi made a poor performance last week and moved down 0.72% versus the greenback. The yen moved up as the Asian stocks performed well. Adding to the positive sentiment of yen was the holding back the statement about any stimulus by the BOJ Governor Haruhiko Kuroda.

Looking bleak, the European trading hours were also very much uneventful with nothing much on the Economic Calendar. A decrease of 3.3% in the Switzerland’s Unemployment Rate is expected, making it the least in four months. Moreover, a slowdown in the output growth is depicted by the UK Industrial Production data. Much to the relief of the investors, these events will have little impact, since the central banks’ monetary policy outlook predicts less movement in Swiss Franc and British Pound price.

However, investors are keen on the scheduled comments from from Minneapolis and Philadelphia Fed Presidents Narayana Kocherlakota and Charles Plosser later in the day. Investors will also keep a watch on the speech by FOMC member and Chicago Fed President Charlies Evans. The market will fervently watch the tone of the speech about setting guide speculation about continuing of the Fed’s effort to narrow the QE asset purchases. A slightly hawkish inclination might likely uplift the US Dollar.

Asian Session

GMT	CCY	EVENT	ACT	EXP	PREV
22:00	NZD	NZIER Business Opinion Survey (1Q)	52	-	53
23:50	JPY	Current Account Total (¥) (FEB)	612.7B	618.1B	-1589.0B
23:50	JPY	Adjusted Current Account Total (¥) (FEB)	-41.4.7B	24.7B	-588.3B
23:50	JPY	Trade Balance - BOP Basis (¥) (FEB)	-533.4B	-593.6B	-2345.4B
1:30	AUD	NAB Business Confidence (MAR)	4	-	7
1:30	AUD	NAB Business Conditions (MAR)	1	-	0
2:50	JPY	Bank of Japan Monetary Base Target (¥)	270T	270T	270T
4:30	JPY	Bankruptcies (YoY) (MAR)	-12.37%	-	-14.62%
5:00	JPY	Eco Watchers Survey: Current (MAR)		-	53
5:00	JPY	Eco Watchers Survey: Outlook (MAR)		39.5	40

European Session

GMT	CCY	EVENT	EXP	PREV	IMPACT
5:45	CHF	Unemployment Rate (MAR)	3.3%	3.5%	Medium
5:45	CHF	Unemployment Rate s.a. (MAR)	3.2%	3.2%	Medium
6:30	EUR	Bank of France Business Sentiment (MAR)	-	98	Low
6:45	EUR	French Central Gov't Balance (€) (FEB)	-	-12.7B	Low
6:45	EUR	French Trade Balance (€) (FEB)	-5000M	-5732M	Low
7:15	CHF	Retail Sales (Real) (YoY) (FEB)	-	0.3%	Low
8:30	GBP	Industrial Production (MoM) (FEB)	0.3%	0.1%	Medium
8:30	GBP	Industrial Production (YoY) (FEB)	2.2%	2.9%	Medium
8:30	GBP	Manufacturing Production (MoM) (FEB)	0.3%	0.4%	Medium
8:30	GBP	Manufacturing Production (YoY) (FEB)	3.1%	3.3%	Medium

Critical Levels

CCY	Supp 3	Supp 2	Supp 1	Pivot Point	Res 1	Res 2	Res 3
EUR/USD	1.3618	1.3673	1.3707	1.3728	1.3762	1.3783	1.3838
GBP/USD	1.6483	1.6541	1.6575	1.6599	1.6633	1.6657	1.6715

AUD/USD Currency Move Up - US Consumer Spending Rises

The Loonies relieved off from 4 month high versus the Greenback on 28th March 2014, with the data displaying consumer spending in the US increasing in February to a top level in three months.
The AUD/USD moved on the Forex session at 0.9295, later the pair dwindled down at 0.9244, reducing at a level of 0.15%. Forex traders speculate a lead of support with a low at 0.9216 and a resistance with a high at 0.9334.

With almost 70% of the American economy providing support to the consumer spending, an increase of 0.3% was seen last month, which drove high sentiments on the Forex Market. Further data from US Commerce Department supported that incomes increased by 0.3% in Feb.