| Wrap Up |
| The Canadian dollar weakened against its U.S. counterpart, pulling back from an eight-month high the day before, as the greenback broadly climbed and after data showed a surprise drop in Canadian jobs in June. The U.S. dollar index gained against a basket of currencies after an unexpectedly strong U.S. payrolls report that caused investors to rethink how dovish a turn the Federal Reserve may take. Canada’s economy shed a net 2,200 jobs in June after two months of gains, but wages jumped by the most in more than a year – a sign of strength that would ruled out the chances of the Bank of Canada cutting interest rates next week. Canadian government bond prices were sharply lower across the yield curve in sympathy with U.S. Treasuries. The two-year bond fell 18.5 Canadian cents to yield 1.623% and the 10-year bond was down 101 Canadian cents to yield 1.576%. |
Levels and recommendations
USDCAD Technical Chart Global stocks were in a muted mood after strong U.S. job gains tempered expectations the Federal Reserve will deliver a large rate cut, while Deutsche Bank shares turned negative as it launched a major restructuring.
There was some positive news on the protracted China-U.S. trade war, with White House Economic adviser Larry Kudlow confirming that top representatives from the United States and China will meet in the coming week for trade talks.
The Turkish lira which weakened as much as 2% against the dollar after Turkey’s central bank governor Murat Cetinkaya, whose four-year term was due to run until 2020, was replaced by his deputy Murat Uysal.
The Canadian dollar is trading flat at 1.3060 levels following the mixed employment data from both US and Canada on Friday. The loonie got some support from increase in crude oil prices. However, the USDCAD pair would likely to have subdued trading action in the absence of significant macroeconomic data release. The USDCAD pair is likely to trade range of 1.3045-1.3125 levels.