Mixed price action from the Loonie this week as traders tried to balance positive oil moves, geopolitical headlines, and net negative economic updates
Mixed price action from the Loonie this week as traders tried to balance positive oil moves, geopolitical headlines, and net negative economic updates from Canada.
Canadian Headlines and Economic data
Record improvement in Canadian business conditions during December – “The headline seasonally adjusted IHS Markit Canada Manufacturing Purchasing Managers’ Index® (PMI®) registered 57.9 in December, up from 55.8 in November, signaling the strongest overall improvement in business conditions since the survey began in October 2010. The headline index has now posted above the 50.0 neutral value in each month since July”
Oil rises on plans that Saudi Arabia will cut its oil production, correlating with CAD’s late rally against most of the majors during the U.S. session. It underperforms against the Kiwi and Aussie, likely on the broad risk-on conditions, influenced by news that the Democratic party retakes control of the U.S. Senate, increasing speculation that more stimulus will be coming to support those hit hard by the pandemic.
Canada’s merchandise trade deficit with the world narrowed from $3.7 billion in October, to $3.3 billion in November. – “Canada’s merchandise exports increased 0.5%, with gold exports posting the largest increase. Imports edged down 0.3%, on lower imports of industrial machinery, equipment and parts.”
Canada loses 62,600 jobs in December, first decline since April – This was “more than double analysts’ expectations of a decline of 27,500, while the unemployment rate edged up to 8.6%, in line with expectations. Employment remains 3.3% below pre-pandemic levels.”