USD/CAD: Canadian Dollar Inches Higher, U.S. CPI Next

 | Mar 12, 2018 11:06

USD/CAD has ticked higher in the Monday session. In North American trade, USD/CAD is trading at 1.2830, up 0.15% on the day. On the release front, it’s a quiet start to the week. There are no Canadian indicators on the calendar. The U.S. releases the federal deficit, with an estimate of $222.3 billion. On Tuesday, Canada releases Ivey PMI and the U.S. publishes CPI reports.

The Canadian dollar ended the week on a high note, posting gains on Friday. The Canadian economy added 15,400 in February, after a sharp decline of 88,000 a month earlier. This was below the estimate of 21,300, but investors were pleased with the strong turnaround. In the U.S., employment numbers were a mix on Friday. Wage growth dropped to 0.1% in February, down from 0.3% a month earlier. This missed the estimate of 0.2%, and marked the lowest gain in four months. The news was much better from nonfarm payrolls, which soared to 313,000, crushing the estimate of 205,000. The mixed numbers have eased concerns about the Fed raising rates four times in 2018, which is good news for the Canadian dollar.

Tensions have eased somewhat regarding the tariffs which U.S. President Donald Trump imposed on Thursday. Trump has exempted Canada and Mexico from the tariffs, and has said that Washington could ease the duties on other countries as well. Importantly, is strong domestic opposition to Trump’s move, including senior Republican lawmakers who have said they will work to overturn the tariffs, which could spark an all-out trade war. So far, the markets are confident that a solution to the tariff tussle will be found.

USD/CAD Fundamentals

Monday (March 12)

  • 13:01 US 10-year Bond Auction
  • 14:00 US Federal Budget Balance. Estimate -222.3B

Tuesday (March 13)

  • 8:30 US CPI. Estimate 0.2%
  • 8:30 US Core CPI. Estimate 0.2%
  • 10:15 BoC Governor Stephen Poloz Speaks

*All release times are GMT

*Key events are in bold

USD/CAD for Monday, March 12, 2018