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Solid Canadian Jobs Stats Help Canadian Dollar Hold Weekly Gains

Last week’s high: C$1.8174

Last week’s low: C$1.7852

NAFTA Hopes and Canadian Data Push GBP/CAD Lower

Despite market hopes for a smoother Brexit process and confidence that the Bank of England (BoE) will hike UK interest rates in May, the Pound to Canadian Dollar exchange rate spent most of last week falling.

Canadian Dollar investors have found the currency more appealing since the end of March, as traders become more optimistic that a solution can be reached on the North American Free Trade Agreement (NAFTA). Signs that the US would rather reach an agreement on the deal than let it collapse have reassured investors.

On top of this, Friday’s Canadian job market results from March were solid. Canada’s participation and unemployment rates stayed static as expected, but 32.3k new jobs were created in March – well above the forecast 20k.

CAD Outlook: Developments on US Trade Stance Remain in Focus

There is not much UK or Canadian data due for publication in the coming week, so the Pound to Canadian Dollar exchange rate is more likely to be influenced by developments in US trade news.

The US President’s planned trade tariffs on Chinese goods have been a major market focus for weeks and could continue to keep pressure on risky trade-correlated currencies like the Canadian Dollar. On the other hand though, further signs that the NAFTA deal could be successfully renegotiated may make help the Canadian Dollar’s current rally to continue.

UK trade and production data is due on Wednesday, but Canada’s only notable ecostats this week will be housing data due on Tuesday and Thursday.

Key Events

10th April

13:15 Canadian Housing Starts

13:30 Canadian Building Permits

11th April

09:30 UK Balance of Trade

09:30 UK Manufacturing and Industrial Production

13:00 UK NIESR Growth Estimate

12th April

13:30 Canadian New Housing Price Index

 

Alastair Archbold

Currency Trader

Tel:  01442 892 066

 

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