When will the Canadian jobs report be released and what impact might it have on the USD/CAD exchange rate?

Canadian Employment Snapshot

Today at 13:30 GMT, Statistics Canada will publish December’s labor market figures. Projections indicate a contraction in the workforce, with an estimated 5,000 job losses, following November’s gain of 53,600 positions. The unemployment rate is anticipated to edge up to 6.6%, compared to the previous reading of 6.5%.

Evidence of a cooling employment sector could weigh on the Canadian Dollar (CAD), as it may strengthen expectations for the Bank of Canada (BoC) to consider lowering interest rates soon. The BoC has maintained its policy rate at 2.25% for the past two meetings, emphasizing that this stance is suitable for keeping inflation near its 2% objective while guiding the economy through ongoing structural changes.

In addition to employment numbers, market participants will closely watch the Average Hourly Wages report, a crucial indicator of wage inflation. In November, wages grew at an annualized rate of 4%.

Potential Impact of Canadian Jobs Data on USD/CAD

The USD/CAD currency pair has continued its upward momentum for a second consecutive week, reaching levels near 1.3871 on Friday, ahead of the US Nonfarm Payrolls announcement. The 20-day Exponential Moving Average (EMA) has climbed to 1.3793, with the pair trading above this threshold, indicating a short-term bullish trend.

The 14-day Relative Strength Index (RSI) stands at 60, signaling positive momentum without suggesting overbought conditions.

From the recent high of 1.4142 to the low of 1.3646, USD/CAD has advanced to approach the 50% Fibonacci retracement level at 1.3894. A daily close above this point could pave the way for further gains toward the 61.8% retracement at 1.3952. Conversely, if the pair fails to surpass 1.3894, the bullish outlook may fade, potentially triggering a pullback toward the 23.6% Fibonacci retracement at 1.3763.

(This technical analysis incorporates insights generated with the assistance of AI tools.)