Weekly Economic Update

For the week of February 9 to 13

Hands holding a  piggy bank and a house modelIt is fairly quiet in Canada with only Housing Starts and Bloomberg Nanons Confidence releasing this morning. Housing Starts for January released at 187.3K (179.6Krevised) compared to the previous revised release of 180.3K in December and according to CMHC’s Chief Economist, Bob Dugan, “Overall, economic and demographic factors remain supportive of housing demand.”

Recapping employment figures from Friday, Canadian data released much higher than expectations with a 34.4K gain compared to expectations of a 5K gain. The release showed strong numbers but with weak supporting data as the increase in jobs came almost solely from part time positions as full time jobs fell -12K. South of the border US Nonfarm Payrolls released very strong Friday, up by 257K in January, overall the US labour market continues looking strong.

Looking at the week ahead it is a fairly quiet one in Canada with the main releases being the New Housing Price Index on Thursday and Manufacturing Sales Friday. Our southerly neighbours have a slightly busier docket with the key releases being Mortgage Applications tomorrow, Retails Sales on Wednesday alongside Jobless Claims, and Import Prices and the U of M Consumer Sentiment Index on Friday.

Though it is quiet in the market post-employment data, headlines abroad from Greece and the Ukraine are drawing attention. Additionally oil is up currently testing the 50 day Moving Average and a break above this could give further strength to CAD against its USD counterpart.

In the currency markets USDCAD jumped almost half a cent on Friday after employment figures as US numbers greatly over shadowed Canadian figures, the pair then closed the week at 1.2524. Into this morning’s session CAD is up alongside oil gaining 0.0025 on the day and currently hovering around 1.25; the correlation between CAD and oil remains strong and a key driver for USDCAD.

Todays’ Expected Range 1.2458 – 1.2558

Source: Bloomberg

Posted by Concentra Financial Markets

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