$USDCAD Elliott wave analysis ahead of BOC decisionFX:USDCAD is supported by 1.3600 into BOC decision. Look for the levels mentioned in the video and a trade for today
BOC
USDCAD: Thoughts and AnalysisToday's focus: USDCAD
Pattern – Heavy Resistance
Support – 1.3514, 1.3454
Resistance – 1.3602
Hi, traders; thanks for tuning in for today's update. Today, we are looking at USDCAD daily.
What are we discussing and asking today after looking at USDCAD?
Will current heavy resistance contnue to block buyers? Does price have enough momentum in its current bull channel? Will this week's data and news be enough of an influence to set off a new break lower or higher?
Key news, US CPI, PPI, Fed meeting minutes. Canadian interest rate decision.
Good trading.
USD/CAD edges lower on strong Canadian GDPThe Canadian dollar is slightly higher on Thursday. USD/CAD is trading at 1.3537 in the North American session, down 0.23%.
Canada’s GDP bounced back with a strong gain of 0.6% m/m in January, after a 0.1% in December. This beat the market estimate of 0.4%. The preliminary estimate for February’s GDP stands at 0.4%, which means that so far, growth in the first quarter is looking solid. This is a major turnaround for the Canadian economy, which narrowly avoided a technical recession in the second half of 2023.
The Bank of Canada meets next on April 10th and the improvement in GDP would support the BoC taking its time before cutting rates. The BoC has held the benchmark rate at 5% six straight times and is looking for the economy to cool and inflation to fall further before it lowers rates. At the same time, households are groaning under the weight of high interest rates, which is putting some pressure on the BoC to provide some relief by lowering rates.
The US also released GDP for the fourth quarter, with the third and final estimate being revised upwards to 3.4% y/y, up from 3.2% in the second estimate and beating the market estimate of 3.2%. The GDP release was respectable but sharply lower than the 4.9% gain in Q3, which indicates that the US economy is cooling down due to elevated interest rates.
The Federal Reserve has sounded more hawkish about rate policy lately. Fed Governor Christopher Waller said on Wednesday that inflation had not fallen as quickly as expected and “there is no rush to cut the policy rate”. Earlier in the week, Atlanta Fed President Rafael Bostic lowered his forecast to just one rate cut in 2024, after saying in February that he expected two rate cuts this year.
USD/CAD is testing support at 1.3559. Below, there is support at 1.3503
1.3661 and 1.3717 are the next resistance lines
CADJPY: Next stop the monthly falling trendline?There's not much in the way of this move from what I can see.
Yen continues to be the weakest currency in the G10 (for now, BoJ look set to intervene at some point this year) and for the short term I expect this to continue to meet the descending long-term trendline that's formed.
I'll be looking for sells around 115 with any LTF confirmation, but until then I'm going to be doing some long scalps not that local resistance has been broken and retested.
USD/CAD muted after mixed retail sales reportThe Canadian dollar is drifting on Friday. In the European session, USD/CAD is trading at 1.3468, down 0.1%. With no tier-1 events on the data calendar, we can expect a quiet day for the Canadian dollar.
Canada’s retail sales report on Friday was a mixed bag. Consumers sharply reduced their spending in January following better-than-expected retail sales in December.
Let’s start with the good news. The end of 2023 saw strong consumer spending, with a gain of 0.9% m/m in December, revised upwards from 0.7% and beating the market estimate of 0.8%. The increase was led by higher sales for motor vehicles, fuel and food. In the fourth quarter, retail sales rose by a respectable 1%.
The news was not nearly as positive in January. The preliminary estimate of -0.4% m/m points to a sharp pullback in consumer spending. The slowdown in retail activity in January could continue as more householders renew their mortgages at higher rates, leaving less money for discretionary spending.
The Bank of Canada has repeatedly stated that rate decisions will be data-dependent, and we’ll have to wait and see what BoC policy makers make of the mixed retail sales release. Canada releases December GDP next week, followed by the BOC rate decision on February 29.
Three top Federal Reserve officials reiterated on Thursday that the Fed is planning to lower interest rates this year but not just yet. Fed Vice Chair Philip Jefferson and Governors Lisa Cook and Christopher Waller said that inflation was headed in the right direction but urged patience.
In December, the markets had priced in a rate cut in March at over 70% but that has dissipated to just 2.5% currently, according to the CME FedWatch tool. The strong US economy and constant pushback from the Fed against rate cuts in March have forced the markets to look ahead. Investors have currently priced in a 65% chance of a rate cut in June, compared to 74% just one week ago.
USD/CAD is testing support at 1.3477. Below, there is support at 1.3446
1.3514 and 1.3545 are the next resistance lines
USD/CAD drifting ahead of FOMC minutesThe Canadian dollar is trading quietly on Wednesday. In the North American session, USD/CAD is trading at 1.3517, down 0.07%.
Investors are anxiously awaiting the release of the minutes of the Fed’s January meeting later today, hoping for some insights about the Fed’s future interest rate path. The markets had priced in a March cut after the Fed signaled in December that it would cut rates. These expectations have been slashed, however, as the Fed has pushed back against expectations of a March cut and economic data has been stronger than expected. The markets are now eyeing the June meeting for a rate cut.
Canada’s inflation rate dropped to its lowest level since June 2023 but the Canadian dollar showed little interest. Headline CPI declined to 2.9% y/y in January, down from 3.4% in December and below the market estimate of 3.3%. This marks the first time that inflation has fallen within the Bank of Canada’s target range of 1%-3% since June 2023. The main drivers of the decline in the headline reading were sharp drops in the price of fuel and food.
Core inflation, which excludes fuel and food, showed a modest decline in January. The average of two of the Bank of Canada’s core measures of inflation came in at 3.35% in January, below the December gain of 3.6%.- The decline in inflation is an encouraging sign for the Bank of Canada. Still, both the headline and core readings are well above the BoC’s goal of 2% inflation, which is the midpoint of the target range.
Traders should keep in mind that inflation has been zigzagging , as it rose unexpectedly in December and fell more than expected in January. As analysts like to say, inflation does not move in a straight line. This leaves BoC policy makers with some uncertainty as to where inflation is headed, but what is clear is that a rate cut is very unlikely until the BoC is convinced that inflation is on a downward trend.
USD/CAD is putting pressure on support at 1.3500. Below, there is support at 1.3415
1.3571 and 1.3656 are the next resistance lines
USD/CAD dips as Canadian employment shinesThe Canadian dollar has climbed higher in the North American session after the release of Canada's December employment report. In the North American session, USD/CAD is trading at 1.3432, down 0.20%.
Canada usually posts employment reports on the same Friday as the US, but had the stage all to itself today, as the US posted its job report last week. The news was good as employment jumped by 37,300 in January, smashing the market estimate of 15,000. The December reading was revised upwards to 12,300 from the initial estimate of just 0.1 thousand. The unemployment rate ticked lower to 5.7%, down from 5.8% in December and below the market estimate of 5.7%. As well, average hourly earnings eased to 5.3% y/y in January, compared to 5.7% a month earlier.
The Bank of Canada will be carefully monitoring the jobs data. Employment growth jumped, which points to a stronger labour market, but at the same time wage growth dropped. Wages are a key driver of inflation and today's decline will support the BoC continuing to pause and not cut rates until the middle of the year or later.
The BoC is content to continue its "higher for longer" stance and let high rates continue pushing inflation lower. The central bank's top priority remains bringing down inflation to the 2% target, but businesses and consumers, especially homeowners, are groaning under the weight of elevated rates and are looking for some relief from the BoC.
The Federal Reserve continues to push back against rate cut expectations in March. This week, a host of Fed members delivered the message that inflation is heading lower but the Fed remains cautious and isn't yet ready to lower rates, as the battle against inflation is not yet won. The markets have taken note of the Fed’s pushback and have pared expectations of a rate cut in March to 17%, down from over 70% in December, according to the CME’s Fed Watch tool.
USD/CAD tested support at 1.3434 earlier. Below, there is support at 1.3392
1.3509 and 1.3551 are the next resistance lines
USD/CAD eyes Bank of CanadaThe Canadian dollar is showing limited movement on Wednesday. In the North American session, USD/CAD is trading at 1.3436, down 0.19%.
The Bank of Canada will announce its first rate decision of 2024 later today. The BoC has maintained the cash rate at 5.0% for three straight times and barring further acceleration in inflation, the rate-tightening cycle is over. The key question is the timing of a rate cut. The BoC would love to chop rates and kick-start the weak economy, but a rate cut appears unlikely unless inflation moves closer to the 2% target.
We've seen the Federal Reserve grapple with the "last mile" of the inflation battle, as inflation remains stubborn in the range of 3-4%, higher than the 2% target. The BoC has managed to push inflation down from a high of 8.1% in mid-2022 but rose slightly in December to 3.4%. Inflation is currently driven by services and housing costs, which are unlikely to fall considerably in the near term. This means that further rate hikes may not be effective in pushing inflation lower.
The BoC has little reason to raise rates, but it is reluctant to start cutting rates while inflation remains well above the target and wage growth is still high. That leaves BoC policymakers with a strong reason to continue holding rates and remaining cautious until inflation moves closer to the 2% target. When can we expect the BoC to hit the rate-cut button? Two of Canada's major banks, RBC and BMO, expect a rate cut in mid-2024, while TD Bank is projecting an initial rate cut in the spring.
USD/CAD is testing support at 1.3451. Below, there is support at 1.3360
There is resistance at 1.3520 and 1.3611
Canadian dollar drifting ahead of CPI releaseThe Canadian dollar is showing little movement on Tuesday. In the European session, USD/CAD is trading at 1.3382, down 0.13%. We could see stronger movement from the Canadian dollar in the North American session, with the release of the Canadian inflation report.
Canada releases the November inflation report later on Tuesday. In October, inflation dropped to 3.1% y/y, down sharply from 3.8%. The market consensus for November stands at 2.9%. Two key core inflation indicators are expected to ease to an average of 3.3%, down from an average of 3.5% in October.
A further drop in inflation would be an encouraging sign for the Bank of Canada, which has raised the cash rate to 5.0% but has paused three straight times. The BoC remained hawkish at the December meeting and kept the door open to additional rate hikes but the markets are convinced that the rate-tightening cycle is over and have priced in rate cuts next year, starting in mid-2024.
A drop in the November inflation report would bolster expectations for rate cuts next year. If inflation surprises on the upside, it would bolster the Canadian dollar and force the BoC to continue pausing rates at restrictive levels ('higher for lower').
The US dollar has hit a rough patch since the Fed meeting last week when Fed Chair Powell penciled in three rate cuts next year. Traders are far more bullish and have priced in six rate hikes in 2024, starting in March.
We're seeing some pushback from the Fed to dampen rate-cut fever in the markets. On Friday, New York Fed President John Williams said a rate cut in March was "premature" and even warned that rates could move higher if inflation were to stall or reverse. Cleveland Fed President Mester said on Monday that the markets are a "bit ahead" of the Fed on rate cuts, as the Fed was focused on how long it would need to maintain rates in restrictive territory, while the markets were focused on rate cuts.
USD/CAD is testing support at 1.3363. Below, there is support at 1.3327
There is resistance at 1.3386 and 1.3422
Trading this week's fundamental events The market's attention will be fixed on the Federal Reserve's final policy meeting of 2023 scheduled for this Wednesday, with the expectation that the US will maintain interest rates at a 22-year high.
Investors will have an opportunity to scrutinize the Fed's statement and Chair Jerome Powell's press conference for any indications of potential rate cuts in 2024 (or lack thereof).
One day prior to the Feds decision, the US is also poised to unveil essential inflation data. Forecasts suggest a marginal uptick of 0.1% in November consumer prices.
Turning attention to Europe, traders will focus on rate decisions from the European Central Bank (ECB) and the Bank of England (BoE), both occurring on Thursday.
The BoE is predicted to maintain borrowing costs at a 15-year high while reiterating the necessity for elevated rates. Any commentary from the bank deviating from this outlook could potentially cause ripples in the market.
Eurozone inflation dropped to 2.4% last month, down from over 10% a year earlier, following ten consecutive rate hikes. This decline brings the ECB's 2% inflation target into view and makes a further rate increase unlikely. Goldman Sachs has forecasted that the European Central Bank's meeting in April will mark the initiation of its first rate cut, followed by a 25 basis points cut at each subsequent meeting throughout the year.
Watching for GBPCAD to follow EURCADWe saw a huge sell off when EURCAD broke it's uptrend last week so I'm watching GBPCAD to see if we get a similar flush. Price has been holding the trend now for several days with price barely able to escape and push higher, leading to further tightening.
Entry signal would be a non ambiguous break of the Daily trend with stop above high of day if possible.
Target is somewhere around the mid Nov break out as shown on the Daily TF, just over 100 pips away.
Daily SWAP is -1.58% so a multi day is possible, but I wouldn't want to go over 3.
Volatility around the CAD rate decision has the biggest downside effect on the idea if we get a break prior to the news. Not much we can do about this, if we get a sell signal before the release I still think it is worth taking.
TradePlus-Fx|USDCAD: BoC meeting💬 Description: Today, the Central Bank of Canada will announce its decision on interest rates. The rate is expected to remain at the same level. Against this background, we continue to adhere to our previous trading idea for USDCAD , namely to look up (look at the chart) . But most likely, there will be volatility during or after the meeting of the Central Bank of Canada, then the pair is most likely to roll back down. The expected movement is thus depicted on the chart . As a result, the more global target remains the same, and we expect growth to 1.38271 level.
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CADJPY: Short scalp next weekThinking we're starting to see JPY strength, this is because it can't stay so weak for so long imho.
Weak currency suits Japan as an exporter, to a point, but massively affects it's buying power, I do feel like we're approaching the end of this cycle of Yen weakness, by the end of this year.
I think this pair broke the rising trendline but has struggled to get back in on multiple retracement attempts, so I think we'll drop to catch the order block in the next week based on current PA.
Canadian dollar calm ahead of retail salesThe Canadian dollar has edged higher on Friday. In the European session, USD/CAD is trading at 1.3688, down 0.23%. Canada releases retail sales later today, which could result in volatility from the Canadian dollar.
Canada wraps up the week with the August retail sales report. The markets are bracing for a deceleration, with an estimate of -0.3% m/m, compared to a 0.3% gain in July. On a year-to-year basis, retail sales are projected to slow to 0.2%, down sharply from 2.0% in July.
The Bank of Canada is widely expected to hold rates at 5.0% for a second straight time at the October 25th meeting. The BoC has raised rates to high levels but has only hiked on two occasions in 2023, which indicates that on the whole, interest rates are where the central bank wants them.
I don't expect to see the BoC trimming rates before mid-2024, but at the same time, the BoC will do its utmost to refrain from further tightening. The takeaway message is that we should expect rates to remain in restrictive territory for some time yet.
Last week's inflation report showed a decrease of -0.1% for both headline and core CPI in September, which beat expectations. On a year-to-year basis, headline CPI dropped from 4.0% to 3.8% and the core rate eased to 2.8%, down from 3.3%.
Fed Chair Jerome Powell said on Thursday that inflation remained too high and that the 2% target would be difficult to reach if economic growth did not cool. Powell didn't provide any hints about future rate policy, saying that rate decisions would be based on data and the economic outlook. The Fed has been sending out a "higher for longer" message, and Powell's focus on high inflation seemed to reiterate this stance.
USD/CAD is testing support at 1.3643. Below, there is support at 1.3585
There is resistance at 1.3716 and 1.3774
UK and Canadian Inflation RatesOverview
UK and Canadian inflation rates will be released next week. These events could provide insight into whether the Bank of England(BOE) and the Bank of Canada(BOC) decide to raise rates further.
The Details
As things currently stand, the BOE will likely pause rates, and the BOC will raise rates again. This is in line with the current inflation figures.
Next week's inflation figures - Tuesday 17th for Canada and Wednesday 18th for the UK - may give more precise direction to what the BOE and BOC decide what to do next: hike, cut, or pause.
August's inflation figure for Canada was 4.00% and 6.70% for the UK.
Things to Consider:
If September's inflation figures are higher or the same as August's, this gives a greater chance of further rate hikes. Another rate hike from the BOC will likely strengthen the CAD. Another rate hike from the BOE will likely strengthen the GBP.
If September's figures are lower than August's, this gives a greater chance of the central banks holding rates and lowering rates in the near future. This will weaken the CAD and GBP.
Key CAD pairs could be FX:EURCAD FX:GBPCAD FX:AUDCAD
Key GBP pairs could be FX:GBPAUD FX:GBPCAD FX:GBPNZD
CADJPY: Cheeky Scalp 1:3 with tight SLWe can see CADJPY rejected off the ascending channel and horizontal resistance confluence.
I think we'll retest following a bounce off the lower boundary, especially seeing how oil is doing and today's CAD data.
I'm really mindful of the end of week BoJ news as I think this could cause some reversals based on recent BoJ fundamentals and historic moves to protect the currency in International markets, but there's time left this week and so picking up pips where I feel safe, ahead of the news.
USD/CAD - Canadian dollar eyes retail salesThe Canadian dollar is showing limited movement on Thursday. In the North American session, USD/CAD is trading at 1.3474, up 0.09%.
Canada wraps up the week with the retail sales report on Friday. July's retail sales were weak, with a gain of 0.1% m/m and a decline of 0.6% y/y. August is expected to show improvement, with consensus estimates of 0.4% m/m and 0.5% y/y.
The Bank of Canada held the benchmark rate at 5.0% at the September 6th meeting. The BOC's summary of deliberations from that meeting, released on Wednesday, showed that the BoC considered raising rates due to stubbornly high underlying inflation.
In the end, the Governing Council members felt that earlier rate increases were having an effect on economic growth and voted to hold rates. Still, there was a concern that a pause might send the wrong message that the tightening cycle was over and that a cut in rates was coming. The BoC therefore stressed at the meeting that the door remained open to further rate increases and that underlying inflation was not falling fast enough.
The Federal Reserve maintained the benchmark rate at 5.5% at Wednesday's meeting. The Fed delivered a 'hawkish hold', signalling that it planned to keep rates in restrictive territory "higher for longer". This message sent US stock markets lower and US Treasury yields higher on Wednesday, with the US dollar showing short-lived volatility against most of the majors following the decision.
The dot plot from yesterday's meeting indicated that the Fed expects to raise rates once more before the end of the year, the same forecast as in the June dot plot. However, the September dot plot projected trimming rates by 50 basis points in 2024, compared to 100 basis points in the June dot plot. This "higher for longer" approach indicates hawkishness on the part of the Fed, which remains focused on bringing inflation back down to the 2% target.
USD/CAD is testing resistance at 1.3468. The next resistance line is 1.3553
1.3408 and 1.3323 are the next support lines
USDCAD: Sideways, but down!Expecting USD weakness this week, and continued CAD strength due to Oil and good fundamentals.
Not much else to say here, great RR on this move if it comes off!
USD/CAD falls to one-month lowThe Canadian dollar has extended its gains on Tuesday. In the European session, USD/CAD is trading at 1.3441, down 0.33%. Earlier in the day, the Canadian dollar strengthened and touched a low of 1.3436, its best showing since September 15th.
The Bank of Canada will be keeping close tabs on today's inflation report. CPI for August is expected to fall to 0.3% m/m, compared to 0.6% m/m in July. The core rate is also expected to ease to 0.3%, down from 0.5%. If the inflation readings decline as expected, it will provide support for the BoC to pause for a second straight time at the October meeting.
The BoC will release the minutes (Summary of Deliberations) of the September meeting on Wednesday. At the meeting, the BoC held the benchmark cash rate at 5.0%. Policy makers reiterated that they stood ready to continue to hike in order to bring inflation back down to the 2% target, saying they “remained concerned about the persistence” of underlying price pressures. I expect that the minutes will make further references to Canada's inflation rate.
The BoC's rate statement at the meeting noted that weaker demand and a concern about the lagging effect of previous hikes led to a decision to keep rates unchanged. Policy makers reiterated that would "continue to assess the dynamics of core inflation and the outlook for CPI”, which makes today's inflation release an important factor in the October rate decision.
USD/CAD is putting pressure on support at 1.3408. The next support line is 1.3323
1.3468 and 1.3553 are the next resistance lines
Canadian dollar steady ahead of jobs reportThe Canadian dollar is steady on Friday in what should be a busy day. In the European session, USD/CAD is trading at 1.3670, down 0.12%. Canada releases the August job report later today, with the markets braced for a decrease of 6,400 in employment.
The US dollar has been on a tear against the major currencies since mid-July. The Canadian dollar has slumped, losing about 450 basis points during that span. The Canadian economy hasn't been able to keep pace with its southern neighbor, and that was made painfully clear as GDP contracted by 0.2% in the second quarter, below expectations.
The deterioration in economic growth is a result of a weak global economy as well as the Bank of Canada's steep tightening cycle. After back-t0-back increases, the BoC opted to pause at this week's meeting and held the benchmark cash rate at 5.0%. Governor Macklem likes to use the term "conditional pause", which means that a break from rate hikes will depend on economic growth and inflation levels.
At this week's meeting, the BoC's rate statement was hawkish, warning that inflation was too high and not falling fast enough. This was a signal that the door remained open to interest rate increases. Macklem was more explicit on Thursday, stating that further rate hikes might be needed to lower inflation and warning that persistently high inflation would be worse than high borrowing costs.
The markets are more dovish about the BoC's rate path, given that the economy is cooling and the central bank will be wary about too much tightening which could tip the economy into a recession. The markets have priced in a 14% probability of a rate hike at the October meeting.
USD/CAD is testing resistance at 1.3657. The next resistance line is 1.3721
1.3573 and 1.3509 are providing support
USD/CAD rises to 22-week high, BoC decision loomsUSD/CAD is trading quietly in Europe at 1.3651, up 0.06%. I expect to see stronger movement in the North American session, with the Bank of Canada making its rate announcement and the US releasing the ISM Services PMI which is expected to show little change.
The Bank of Canada is virtually certain to hold rates at today's meeting, with just a 6% probability of a rate hike, according to the TMX Group. That would leave the benchmark cash rate at an even 5.0%.
BoC Governor Macklem would certainly like to call it quits on the central bank's aggressive tightening cycle and perhaps he can look for advice from his peers at the Federal Reserve and the Reserve Bank of Australia. Both the US and Australian economies have seen inflation fall significantly, but Jerome Powell at the Fed and Peter Lowe at the RBA have sent the markets a hawkish message that inflation isn't beaten and the door is open for further rate hikes if necessary. The markets have taken a more dovish stance and are already looking ahead to possible rate cuts.
Macklem appears to face the same challenge of acknowledging that rate hikes have cooled the economy and curbed inflation while sounding credible about keeping open the option of further rate hikes. Last week's GDP report indicated that the economy contracted by 0.2%, compared to the BoC's forecast of 1.5% growth. The BoC has hiked repeatedly in order to lower inflation but there are concerns that the rate hikes in June and July may have tilted the risk toward a recession.
The Federal Reserve is widely expected to pause at the September 20th meeting. The pause could signal that rates have finally peaked, although don't expect any Fed members to publicly state that the rate-tightening cycle is over.
Federal Reserve Governor Christopher Waller said on Tuesday that the Fed can afford to “proceed carefully” with rate hikes, given that inflation has been falling, and if the downtrend continues, "we are in pretty good condition".
USD/CAD tested resistance at 1.3657 earlier. The next resistance line is 1.3721
1.3573 and 1.3509 are providing support
GBPCAD: Running out of steam, start of the reversal?In my opinion GBP is building up for a big fall this year, and it has to start with a lower high.
Oil prices are rising, and as much as the FED don't want this, it's happening, and this should be good for CAD.
I can see a rising wedge pattern, we can see spinning tops forming and it looks like we're running out of steam, I believe we'll initially fall back to the 1.7 support / round number.
I'm waiting for my entry, I expected GBP to fall before now, but the BoC unemployment news wasn't supportive last week.
USD/CAD shrugs after soft nonfarm payrollsThe Canadian dollar is showing limited movement on Friday. In the North American session, USD/CAD is trading at 1.3360, up 0.06%. Canadian and US job numbers were soft today, but the Canadian dollar's reaction has been muted.
After a stellar job report in June, the July numbers were dreadful. Canada's economy shed 6,400 jobs in July, compared to a 59, 900 gain in June. Full-time employment added a negligible 1,700 jobs, following a massive 109,600 in June. The unemployment rate ticked up to 5.5%, up from 5.4%.
Perhaps the most interesting data was wage growth, which jumped 5% y/y in June, climbing from 3.9% in May. The rise is indicative of a tight labour market and will complicate the Bank of Canada's fight to bring inflation down to the 2% target.
It was deja vous all over again, as nonfarm payrolls failed to follow the ADP employment report with a massive gain. In June, a huge ADP reading fuelled speculation that nonfarm payrolls would also surge, and the same happened this week. Both times, nonfarm payrolls headed lower, a reminder that ADP is not a reliable precursor to the nonfarm payrolls report.
July nonfarm payrolls dipped to 187,000, very close to June reading of 185,000 (downwardly revised from 209,000). This marks the lowest level since December 2020. The unemployment rate ticked lower to 3.5%, down from 3.6%. Wage growth stayed steady at 4.4%, above the consensus estimate of 4.2%.
What's interesting and perhaps frustrating for the Fed, is that the jobs report is sending contradictory signals about the strength of the labour market. Job growth is falling, but the unemployment rate has dropped and wage growth remains strong. With different metrics in the jobs report telling a different story, it will be difficult for the Fed to rely on this employment report as it determines its path for future rate decisions.
There is resistance at 1.3324 and 1.3394
1.3223 and 1.3182 are providing support
