USD/CAD – Greenback eases on mixed US labour market data

on Aug 2, 2013

**, Friday 2 August:** The Royal Bank of Canada’s Manufacturing PMI for July came out at 52.0, marginally down from June’s 52.4. That insipid number did nothing to slow the USD/CAD’s advance since the beginning of the week, which took added momentum from the release of better-than-expected manufacturing and jobless claims from the US.

The Canadian dollar’s decline against its American peer continued throughout today’s session until reaching 1.04 just before the New York opening, where the quote found strong resistance.
The US unemployment rate for July came out at 13.30 BST, beating expectations for 7.5 percent with a solid reading of 7.4 percent and measurably down on the prior period’s 7.6.

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Offsetting the fall in the unemployment rate, Change in US Nonfarm Payrolls for July m/m was reported as a drop to 162,000 new jobs created in the month, well down on June’s 188,000(revised from 195,000), and well below analysts’ expectations for 185,000.
Average Hourly Earnings for June m/m fell by 0.1 percent versus the forecast rise of 0.2 percent and June’s 0.4 points.

Personal Spending for the period came out in line with expectations at 0.5 percent up. The prior period was revised from 0.4 to also be 0.5 percent growth.
The Core PCE (Personal Consumption Expenditures) Price Index for June m/m checked in at 0.2 percent, beating the market forecasts and prior 0.1 percent growth.
Personal Income was reported at 0.3 percent, down on forecasts for 0.4 percent growth. The previous reading was revised to 0.4 percent down from 0.5.
And finally, Factory Orders at 1.5 percent growth disappointed expectations for 2.3 percent. The prior period was revised up to three percent growth from 2.1.
Following these releases, the USD/CAD currency pair found strong resistance around 1.04 and dropped sharply to 1.0340. Currently the quote is around 1.0374, still 0.26 up on the day.


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