When is the Canadian monthly jobs report and how could it affect USD/CAD?

Canadian jobs report overview

Statistics Canada will publish its labour market figures for the month of January later during the early North-American session at 13:30 GMT. Consensus estimates point to an uptick in the unemployment rate to 5.7% from 5.6% previous and the number of employed people to rise by 8.0K as compared to 9.3K rise seen in the previous month.

Analysts at TD Securities (TDS) offered a brief preview of today's key economic event: “CAD January's labour force survey will set the tone, with TD looking for job growth to recover to an above-consensus 15k. This should leave the unemployment rate to hold steady at 5.6% while we look for a modest improvement in wage growth to 1.7% y/y.”

Commenting on the accompanying Average Hourly Earnings data, Yohay Elam, FXStreet's own Analyst writes: “While official expectations are not available for this data point, markets will want to see a recovery towards at least 2%. However, if salary growth remains depressed, the Canadian Dollar could struggle even if the nation posts another month of significant job gains.”

How could it affect USD/CAD?

Ahead of the key event risk, the pair was seen holding steady above the 1.3300 handle and consolidating this week’s strong gains to two-week tops. Any disappointment from today’s jobs report might add to the recent selling around the Canadian Dollar and lift the pair further towards Jan. swing high resistance near the 1.3375 region. 

On the flip side, the market reaction to a slightly better than expected reading might turn out to be rather muted and should be negated by the prevalent weaker tone around crude oil prices. Hence, any meaningful slide back below the 1.3300 handle seems more likely to be limited and find decent support near the 1.3270 horizontal zone.

Key Notes

   •  Canadian jobs preview: Jobs may fall, but CAD may worry about wages

   •  USD/CAD hits fresh 2-week tops, focus shifts to Canadian employment details

   •  USD/CAD Technical Analysis: 1.3370 seems next on buyers’ radar

About Canadian jobs report

The employment report released by Statistics Canada is a leading indicator for the Canadian Economy. A rise in the employment change/fall in the unemployment rate has positive implications for consumer spending, which stimulates economic growth and is seen as positive (or bullish) for the CAD, while the opposite could negatively impact the domestic currency.