For the week of January 14 – 18
It will be a very quiet start to the week for Canadian data. However, Friday includes big releases such as consumer prices data, and an update on international securities transactions. Data releases in the United States this week include empire manufacturing, retail sales, housing starts, building permits, industrial production and U. of Mich. Sentiment. Prices are also expected to have dropped by 0.3 percent on a month-over-month basis in December after falling by 0.4 percent the month before. On a year-over-year basis, the growth rate of 1.7 percent seen in November is expected to remain through December.
Consumer prices in the United States for the month of December posted almost entirely in line with expectations. On a headline basis, prices dropped by 0.1 and increased by 1.9 percent on a month-over-month and year-over-year basis. This is the first drop in headline month-over-month growth for this indicator since March of 2018. When excluding food and energy prices, growth levels were closer to 0.2 and 2.2 percent respectively. The headline figures were largely weighed down by falling energy prices, as is apparent based on the above numbers.
The Canadian dollar is currently trading down against the US dollar. Today’s expected range is 1.3233 – 1.3333.
For the week of January 7 – 11
Markets continue to react in anticipation of news from ongoing trade conversations between the United States and China. The United States has mentioned the conversations have been going well over the past couple of days, and the two countries should be able to reach what they call a “reasonable” deal. A deal between the two countries would come as a great relief to most, especially following the negative release by Apple, who pointed a finger primarily at China for recent weakness in sales figures.
The President of the United States Donald Trump will be addressing American citizens today with the hopes of convincing many on the dire need of a border wall between the United States and Mexico. The lack of funding for the wall over the past two weeks (approximately 5 billion dollars) has led to a partial government shutdown in the United States. Trump has threatened this shutdown could continue to last months, or even years.
Canadian markets will see a release for international merchandise trade this morning, and housing starts figures on Wednesday.
The Canadian dollar is currently trading up against the US dollar. Today’s expected range is 1.3230 – 1.3330.
For Week of December 31 – January 4
Another slow week for data is expected out of Canada this week. Despite not having many indicators releasing data, we are still expecting to see updated employment numbers on Friday. December employment numbers are expected to show an increase of 10.0K positions after remarkable 94.1K positions were added a month earlier. The unemployment rate is expected to tick slightly higher to a level of 5.7 percent from 5.6 percent in the previous reading.
In the United States, we are expecting to see a bit more data this week including releases for wholesale inventories, new home sales, ADP employment change, ISM manufacturing, construction spending and finally nonfarm payrolls. Nonfarm payrolls for December are expected to show an increase of 180K positions after a disappointing 155K a month earlier. The unemployment rate is expected to remain at a level of 3.7 percent.
There are talks of a potential meeting being set up between the President of the United States Donald Trump and Fed Chair Jerome Powell. Although many think a meeting such as this could ease tensions between the two, many others are warning Powell it may not be a good idea. A meeting between the two could give investors the impression that the Fed is not as independent as originally thought.
The Canadian dollar is currently trading up against the US dollar. Todays expected range is 1.3575 – 1.3675.
For the week of December 17 – 21.
Friday started on a negative tone with the release of disappointing industrial production and retail sales data out of China. Industrial production came in below consensus at 5.4 percent year-over-year, vs. consensus and previous of 5.9 percent. Retail sales came in at 8.1 percent year-over-year, vs. consensus of 8.8 percent and previous of 8.6 percent, which is the weakest pace since 2003. In Europe, both France and Germany also released weak PMI numbers that were below expectations.
November retail sales in the United States rose 0.2 percent, beating expectations of 0.1 percent, while retail sales ex-auto dealers, building materials and gasoline stations rose 0.6 percent in November. Nine out of thirteen retail categories rose for the month of November, while eleven categories contributed to the retail sales growth in August. Unfortunately, the decent United States retail sales data wasn’t enough to offset the sluggish market sentiment.
Data releases in Canada this week include existing home sales, manufacturing, consumer price index, retail sales and GDP data. Releases out of the United States this week include housing starts, existing home sales, consumer spending, personal incomes, durable goods orders, GDP, and University of Michigan sentiment readings. Although the markets are still not fully priced for a hike, the Federal Reserve is forecast to increase the overnight target range by another 25bps at the conclusion of the Federal Open Market Committee on Wednesday. Attention will be on the Federal Reserve statements, particularly on neutral rates and inflation forecasts.
Both US and Canada government yields are trading flat to 1bps lower with S&P futures lower (-7.3). The Canadian dollar is trading flat against the US dollar this morning, today’s expected range is 1.3334 – 1.3434.
For the week of December 10 – 14
Employment figures crushed expectations in Canada for the month of November. The country added 94.1K new positions against expectations of a mere 10K. This position increase is the largest one month gain since 1976. Digging further into this release unveils another positive fact which is that of the 94.1K positions, 89.9K of them were the more desirable full-time positions. The posting shows resilience in the job market despite the headwinds stemming from an oil crisis. One darker spot of note is wage inflation which fell to a level of 1.5 percent, down from 1.9 percent in the previous month and short of the expected 1.8 percent. The unemployment rate fell to 5.6 percent from 5.8 percent in the prior reading.
Nonfarm payrolls in the United States missed expectations for November with only 155K new positions created, shy of the 198K expected. Average hourly earnings missed expectations slightly on a month-over-month basis at 0.2 percent, but are still in line with the 3.1 percent year-over-year growth that was expected. The unemployment rate in the US remained unchanged at 3.7 percent.
It is shaping up to be a quiet week for data released out of Canada this week with the only potentially market-moving data coming from housing starts and building permits this morning. November’s housing starts are following a posting of 205.9K a month prior. In terms of October’s building permits, today’s reading is following growth of 0.4 percent in September. Data releases will be a bit more exciting out of the United States this week, with releases expected for consumer prices, retail sales and market US manufacturing PMI among others.
The Canadian dollar is currently trading slightly up against the US dollar after a large spike on Friday from stronger than expected jobs data. Todays expected range is 1.3264 – 1.3364.
For the week of December 3 – 7.
GDP released weaker than expected for the month of September in Canada. Instead of increasing by 0.1 percent as expected, the measure dropped by 0.1 percent on a month-over-month basis. Growth missed expectations on a year-over-year basis as well, growing by only 2.1 percent. In terms of quarterly annualized GDP, the measure is sitting at 2.0 percent for the third quarter, in line with expectations.
Data releases in Canada this week include International Merchandise Trade, employment, housing starts, and building permits. November employment in the country is expected to have increased by 10.0K positions after a similar increase of 11.2K in October. The Bank of Canada is also holding a policy meeting on Wednesday. Currently, the markets are pricing in a zero percent chance of an interest rate hike at this meeting. The implied probability increases to 57.7 percent for the following meeting in January.
Data releases in the United States this week include ISM manufacturing, ADP employment change, Trade balance, employment and wholesale inventories, and trade sales. In addition, the Fed will also be releasing its Beige Book on Wednesday.
The Canadian dollar is currently trading up against the US dollar. Today’s expected range is 1.3145 – 1.3245.
For Week of November 26 – 30, 2018
It will be a relatively slow week for data releases out of Canada until Friday when we will see the release of September GDP figures as well as third quarter GDP figures. Although economist expectations are not available yet, the postings will follow a quarterly annualized GDP posting of 2.9 percent, a month-over-month GDP posting of 0.1 percent and a year-over-year GDP posting of 2.5 percent.
In the United States this week we are expecting releases for wholesale inventories, annualized quarter-over-quarter GDP growth, new home sales, personal income and spending, and new home sales. In addition to these data releases, the FOMC will also be releasing their November 8 meeting minutes on Thursday.
Retail sales in Canada beat expectations in September, growing by 0.2 percent when expectations were for zero growth. Excluding autos from this figure brought the growth level down slightly to 0.1 percent. Consumer prices jumped by 0.3 percent on a headline month-over-month basis in October, triple economist expectations. On a year-over-year basis, price growth is sitting at a level of 2.4 percent. The largest contributor on the upside was the transportation category while the largest contributor to the downside was the gasoline category.
The Canadian dollar is currently trading up against the US dollar this morning. Todays expected range is 1.3150 – 1.3250.
For the week of November 19 – 23.
Data releases in Canada this week include the heavy hitters of consumer prices and retail sales (both released on Friday). The release of retail sales data for September will follow August’s 0.1 percent decline (0.4 percent drop when excluding autos). In terms of consumer prices, Friday’s October figures posting follows a significant 0.4 percent drop on September’s month-over-month basis. Data releases in the United States this week include housing starts, durable goods, existing home sales and Markit US manufacturing PMI.
Manufacturing sales in Canada released stronger than expected in September, growing by 0.2 percent. Excluding auto sales, September’s figure saw a significant drop to -0.5 percent. 8 of the 21 measured industries experienced sale increases. New orders fell by 0.3 percent through the month, while unfilled orders jumped by 0.4 percent. Total inventories were up by 0.3 percent on a month-over-month basis. August’s reported 0.4 percent drop was revised further downward to a drop of 0.5 percent.
The Canadian dollar is currently trading down against the US dollar. Today’s expected range is 1.3128 – 1.3228.
For the week of November 12 – 16
It will be a quiet and short week for data in Canada, with the only market-moving data coming in the form of manufacturing sales and international securities transactions, both of which release on Thursday. We will see a bit more out of the United States this week with releases expected for consumer prices, retail sales and industrial production, among others. Consumer prices are expected to have grown by 0.3 percent on a headline basis during October, three times the speed that was seen in September. On a year-over-year basis, this should put growth at 2.5 percent. Excluding food and energy, growth rates are expected to sit at 0.2 and 2.2 percent respectively.
The string of declines in oil prices has reached eleven business days as priced ended the day down by 0.43 percent on Monday. Prices are down by a further 1.94 percent this morning. Prices shrugged off news that a potential 2019 output-cut could be on the table at an OPEC meeting over the weekend. Crude production the United States was at a record high last week with a level of 11.6 million barrels per day.
The Canadian dollar is currently trading up against the US dollar. Todays expected range is 1.3182 – 1.3282.