The Canadian Dollar is trading at 0.78 against the US Dollar this morning, down -0.20%. The open rate sits at 0.7824 compared to the previous close of 0.7822 with a YTD return of 1.34%. The pair’s daily range will stay between 0.77- 0.78, the 52-week range will fluctuate between 0.68 – 0.78.
Over the past month, CAD has gained traction, steadily increasing from the 0.76 support level, this is likely correlated with the decline in Canadian unemployment rates. The USD has remained flat against a broad basket of currencies.
The strength of CAD has been unexpected as unemployment rates “propel the loonie to its best level in more than two years” according to FXStreet. In Statistics Canada’s November Employment Change, the government reported that there were 62,100 new workers which is more than triple the forecasted rate of 20,000. This has brought the total number of hired workers to “80.9%, 2.430 million of the 3.004 million layoffs in March and April.”
US job creation levels have fallen by more than half over the last month as America faces pressure due to business closures that were ordered by several state governments. US Nonfarm Payroll numbers rose by just 245,000, its lowest numbers during the pandemic and less than half of the 469,000 that was projected, bringing the US re-employment rate to around 55%.
Traders are paying attention to news regarding a potential stimulus package in the US, “House Speaker Nancy Pelosi recently stated that negotiations have gained momentum but it remains to be seen whether Republicans or Democrats will be able to reach a compromise.”
By Surina Nath