The USD/CAD currency pair today rallied higher after the release of the Canadian employment report for May, which missed expectations by a huge margin. The currency pair later retraced most of its gains as the markets digested the positive aspects of the report, while trade concerns limited the currency pair’s upside.
The USD/CAD currency pair rallied to a daily high of 1.3039 from a low of 1.2966 gaining over 70 points, but was on a downtrend at the time of writing.
The currency pair rallied higher following the release of the Canadian labor market report for May by Statistics Canada in the early American session. The employment report indicated that the Canadian economy shed 7,500 jobs in May versus the expected addition of 23,500 new jobs, which is what triggered the short-lived rally. However, the country’s unemployment rate was not effected as it came in at 5.8%, which was in line with expectations. The average hourly earnings for permanent employees beat expectations leading to the pair’s decline as wages grew by 3.9%, as opposed to the expected 3.2% expansion.
The Canadian housing starts data also missed expectations by coming in at 196,500 units versus the expected 220,000 units. The industrial capacity utilization rate also missed expectations, but had a muted impact on the pair.
The currency pair’s short-term performance is likely to be affected by the outcome of the G-7 meeting that begins later today in Quebec, Canada.
The USD/CAD currency pair was trading at 1.2994 as at 13:56 GMT having dropped from a high of 1.3039. The CAD/JPY currency pair was trading at 84.25 having declined from a high of 84.69.
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