USD/CAD: Canadian Dollar Lower Ahead of US, Canada Jobs Data

2 weeks ago

1 minute read

2025.02.07 09:45

The is showing limited movement for the third consecutive day. In the European session, USD/CAD is trading at 1.4328, up 0.14% on the day.

The week wraps up with the January from Canada and the report from the US, which could mean USD/CAD will be active in the North American session. Canada and the US are coming off sparkling job growth numbers in December and it will be interesting to see how the market reacts to the January data, which is expected to be much lower.

Employment in Canada climbed 91 thousand in December, a blowout reading which was the largest gain since Jan. 2023. It was the fourth straight monthly increase and that trend is expected to continue, with a market estimate of 25 thousand for January. The is expected to rise to 6.9%, up from 6.7% in December. This would be the highest unemployment rate since Sep. 2021 and would support the case for further rate-cutting from the Bank of Canada.

US Nonfarm Payrolls Expected to Drop

The US wraps up the week with nonfarm payrolls, one of the most important economic events. The market estimate stands at 170 thousand for January, after a surprisingly strong gain of 256 thousand in December. If the January forecast is accurate, it would mark a sharp drop that would make headlines, but it would not be far off the past three-month average.

The is unlikely to show much concern if job creation slows, as long as the labor market is cooling at a slow pace. The Fed is expected to cut rates only once or twice this year, but that could change if or the labor market provides any surprises. USD/CAD-4-Hour Chart