Blowout Canadian Jobs Figures Fail to Inspire Sustained CAD Rally
- CAD Unemployment Rate headline reading crushes analyst estimates.
- CAD Net Change in Employment beats prior reading by +85.1K.
- USDCAD finds support at C$1.1159.
The Canadian unemployment rate reached a six-year low in September per data released this morning. The headline reading beat analyst expectations of 7.0% at 6.8%, an impressive figure considering that the participation rate was unchanged at 66.0%.
This morning’s unemployment rate saw the largest percentage change in the headline Canadian jobless figure since the December 2013 print. Nevertheless, the Canadian Unemployment Rate is little changed over 2014 despite falling back to its lowest level since December 2008 – the headline was 7.0% entering the year.
According to a Bloomberg news release, the largest employment sectors contributing to the decreased unemployment rate were the goods-producing and natural resource industries. The large net change in employment was supported by full-time employment gains, which is an more positive indicator than a large change in part-time employment.
Here’s a summary of the data this morning that initially stoked Canadian Dollar strength:
- CAD Unemployment Rate (SEP): 6.8% versus 7.0% expected, from 7.0%.
- CAD Net Change in Employment (SEP): 74.1K versus 20.0K expected, from -11.0K.
- CAD Participation Rate (SEP): 66.0 versus 66.0 expected, from 66.0.
USDCAD 1-minute Chart: October 10, 2014 Intraday
Charts Created using Marketscope – prepared by Tyler Amend
USDCAD fell by approximately -51-pips to C$1.1159 immediately after the release. The pair gained some support and closed higher on the 12:30 GMT candle, but continued to a low 1.1161 before finding enough buyers to begin retracing some of the losses in major pair. USDCAD was last seen trading at 1.1188.
--- Written by Christopher Vecchio, Currency Strategist and Tyler Amend, DailyFX Research
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