For the week of June 4 – 8.
The US economy added 223k jobs in May, exceeding expectations of 190k. Construction jobs increased by 25k, manufacturing increased by 18k, and service providers increased by 171k. Auto and parts makers and temporary help services experienced a decrease in jobs. Average hourly earnings increased 2.7 percent from the prior year, exceeding expectations of 2.6 percent. The number of people employed increased by 293k, and the number of people unemployed decreased by 281k. As a result, the unemployment rate dropped to 3.8 percent from 3.9 percent. The unemployment rate has never been this low since April 2000.
Markit Canada Manufacturing PMI’s in May increased to 56.2 from April’s 55.5, making it the highest reading since April 2011. The new orders component rose to 57.6 from 55.7 in April, marking a twentieth straight month of expansion. However, the employment component decreased to the lowest reading since December 2017. Meanwhile, the US PMI fell slightly in May to 56.4 from April’s 56.5. New orders in May decreased to 58 from April’s 58.8.
ISM Manufacturing in May exceeded expectations, coming in at 58.7 versus the expected 58.2. The new orders component rose to 63.7 from 61.2, while the order backlogs index increased to 63.5, making it the highest reading since 2004. The employment gauge also had its first increase in three months to 56.3 from 54.2. 16 out of the 18 manufacturing industries reported growth in May. No industry had a decrease in employment.
Data releases in Canada this week include international merchandise trade, building permits, housing starts, and the May employment report. Major scheduled releases south of the border include various manufacturing figures, the trade balance, and wholesale inventories.
The Canadian dollar is trading a bit higher from Friday’s market close. Today’s expected trading range is 1.2865 – 1.2965.
For the week of May 1-5
GDP figures released from both Canada and the United States on Friday were lower than expected. In Canada, month-over-month growth stalled in February, with zero percent growth compared to an expectation of 0.1 percent growth. This difference is significant compared to the previous month when growth was 0.6 percent. On a year-over-year basis growth has not exceeded expectations, despite an uptick to 2.5 percent. February’s decreasing of manufacturing (down 0.6 percent) and production has fueled disappointment. Annualized quarter-over-quarter GDP growth in the United States was released at 0.7 percent, dropping from 2.1 percent in the prior reading and short of the expected 1.0 percent.
University of Michigan Sentiment dropped in the United States for April to 97.0 from a prior posting of 98.0. American’s view of the current economic condition decreased slightly from 113.2 to 112.7, while expectations for the future jumped to 87 from 86.5.
Oil prices received some positivity on Friday as Russia stated they’ve met their required production cuts amounting to 300 thousand barrels. Prices ended the day up by .74 percent, but are down by .55 percent as of Monday, May 1. The Canadian dollar is currently trading flat against the US dollar.
Releases expected out of Canada this week will include international merchandise trades and employment figures. Canada is expected to have added 10K positions in April after adding 19.4K positions in March. Releases out of the United States will be seen for ISM manufacturing, ADP employment changes, trade balance, and employment figures. The Federal Reserve will also hold a policy meeting where a decision is expected to be released on May 3.
For the week of January 11 to 15
It was a relatively quiet Monday for data with the most notable release coming from Canada’s Housing Starts data. Housing Starts for the month of December released at 173.0k, missing the expectation of a posting of 200.0k, after November’s release of 211.9k. Business Outlook Future also released data Monday in Canada at 16.00 for the fourth quarter, matching last quarter’s data. It was very quiet in the United States Monday with only one scheduled release. Average Monthly Change in Fed Labor Market Conditions Index posted at 2.9 for the month of December following November’s release of 0.5.
With little expected data releases throughout Canada this week, focus will be falling on Monday’s release of December’s Housing Starts as well as November’s New Housing Price Index which releases on Thursday. New Housing Price Index is expected to grow by 0.2% after growing by 0.3% for the month of October. Focus in the United States this week will be on releases from MBA Mortgage Applications, Initial Jobless Claims, Retails Sales, PPI Final Demand, Empire Manufacturing, and Industrial Production. Data for MBA Mortgage Applications will be released on Wednesday following last week’s drop of 11.6%. Initial Jobless Claims for the week of January 9 are expected at 275k after the previous week’s posting of 277k. Retails Sales Advance MoM for December is expected to drop 0.1% after growing 0.2% in the prior month. PPI Final Demand MoM for December is expected to fall 0.2% after growing by 0.3% in November. Empire Manufacturing for January is expected to post at -4.00 following December’s -4.59. Lastly, Industrial Production for December is expected to decrease 0.2% after falling 0.6% in November.
In the currency markets, the Canadian dollar is trading relatively flat against it’s U.S. counterpart early this morning. After a strong start yesterday morning for the Canadian dollar the U.S. dollar fought back and ended up on top for the day after oil prices dropped as much as 5.28% through the day. This morning, oil is only slightly down, approximately 9 cents per barrel. Focus throughout this week will continue to be on oil. Any major moves in the exchange rate will likely be attributed to any major moves in the price per barrel.
Todays expected range: 1.4164 – 1.4264
Posted by Concentra Financial Markets
For the week of March 2 to 6
In Canada this morning, the Current Account Balance is expected to release at -$12.5B for the fourth quarter compared to -$8.4B in the previous release. The RBC Canadian Manufacturing PMI will update for February after falling to 51.0 in the first month of January 2015. In the United States, Personal Income is expected to post an increase of 0.4% for January following a gain of 0.3% in the most recent announcement. Spending is forecast to decrease slightly by 0.1% for December after a drop of 0.3% from December 2014. Later this morning, Construction Spending is expected to post an increase of 0.3% for January, following a gain of 0.4% in the most recent update. Also on the schedule, ISM Manufacturing is forecast to fall slightly to 53.0 for February, down from 53.5 in January.
Headlines throughout Canada this week include an update to GDP scheduled for Tuesday March 3 followed by the Bank of Canada Rate Decision on March 4. GDP is forecast to rise by 0.2% for December, compared to a drop of 0.2% in the previous month. Economists are now calling for the Bank of Canada Rate to remain at 0.75% despite initial forecasts calling for another rate cut, down to 0.50%. In the United States, focus falls on the payroll data scheduled to release on Friday. Nonfarm Payrolls are expected to increase by 235K while the Unemployment Rate is expected to fall slightly to 5.6%.
In the currency markets, the Canadian dollar has shown strength against its U.S. counterpart in early trading today. This week, Canadian dollar trading will revolve around the key economic data releases out of Canada and the United States and the Bank of Canada Rate announcement. The price of oil continues to trade below $50 per barrel which could lead to a more dovish announcement from Governor Poloz. Following this week, attention will shift to the next rate announcement from the Federal Reserve, scheduled for March 18, 2015.
Todays expected range: 1.2455 – 1.2555
Posted by Concentra Financial Markets
For week of February 23 – 27 , 2015
In Canada this morning, the Bloomberg Nanos Confidence Index is the only release on the schedule. The Index has fallen in two straight weeks leading up to today’s release and is currently sitting at 54.15. In the United States, Existing Home Sales are forecast to drop by 1.8% for January, releasing at 4.95M after posting a gain of 2.4% in the previous month. Also on the schedule today, the Dallas Fed. Manufacturing Activity index is expected to release at -4.0 for February compared to -4.4 from the latest release.
The highlight of this week in Canada comes on Thursday with an update to the Consumer Price Index. The CPI is expected to fall by 0.4% m/m for January while posting a gain of 0.8% y/y. Core CPI is expected to rise slightly by 0.1% m/m and 2.1% y/y. Headlines throughout the United States include updates to the CPI scheduled for Thursday followed by GDP data on Friday. CPI is expected to post a monthly decrease of 0.6% for January and GDP is expected to rise by a 2.0% annualized rate for the fourth quarter.
In the currency markets, the Canadian dollar is falling against the USD in early trading this morning. The USD has shown broad based strength as we are approaching the next rate announcements from the Bank of Canada and the Federal Reserve. The price of oil has fallen today, trading just below $49 per barrel which concerns Canadian markets. Slumping oil was the tipping point for the Bank of Canada when they announced the first rate cut, without any real recovery, many analysts are expecting another rate cut at the March 4th announcement.
Todays expected range: 1.2575 – 1.2675
Posted by Concentra Financial Markets