- USD / CAD fell sharply early in the US session.
- Nonfarm payrolls in the US increased less than expected in May.
- Employment in Canada fell by 68,000, the unemployment rate rose to 8.2%.
The pair USD / CAD it rose to its highest level in a week at 1.2134 on Friday, but turned south in the second half of the day. After falling to a daily low of 1.2070, the pair appears to have entered a consolidation phase and was last seen losing 0.15 on the day at 1.2083. During the week, the pair remains on track to close with little change.
Renewed USD weakness drags USD / CAD lower
Hours earlier, the uninspiring May jobs report from the US put the dollar under strong selling pressure. The US Bureau of Labor Statistics reported that nonfarm payrolls increased by 559,000, disappointing the market’s expectation of 650,000. The underlying details of the post showed that labor force participation fell to 61.6% from 61.7 in April.
With these figures suggesting that the Fed will not be in a hurry to begin to reduce the discussions, the US Dollar Index erased a large chunk of Thursday’s gains and is currently shedding 0.37% to 90.15. Additionally, the yield on 10-year US Treasuries is down nearly 4%.
On the other hand, Statistics Canada announced that employment in Canada fell by 68,000 in May, compared to analysts’ estimate of 20,000, and capped CAD earnings. Additionally, the unemployment rate rose to 8.2% from 8.1%.
Technical levels
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