11 Mar 2016
CAD: Setting up for February employment numbers – TDS
Research Team at TDS, suggests that the pace of hiring in the Canadian labour market likely remained subdued in February, with TD expecting the addition of a mere 5k jobs.
Key Quotes
“The unemployment rate is forecast to have remained unchanged at 7.2%. Note that this is a low conviction call as beyond a prospective rebound in self-employment, there is little else to suggest that the other major components are poised to either unwind or extend their January moves. This uncertainty is also accentuated by the contrast between several high profile announcements of layoffs in the resource sector and recent surveys of hiring intentions that have shown a modest improvement. Note that if our forecast is realized, the six-month pace of employment will slip modestly from 9k to 6k which we view is consistent with conditions in the wider economy.
A more subdued labour market report would support our general view that USDCAD is trying to carve out a base after its sharp move lower in recent weeks. While the headlines surrounding surprisingly strong monthly GDP report for December have offered some reassurance on growth, we note that Canada’s overall momentum remains soft. Continued gains in oil prices will provide further support for the CAD, but US growth has started to show some signs of a spring thaw.”
Key Quotes
“The unemployment rate is forecast to have remained unchanged at 7.2%. Note that this is a low conviction call as beyond a prospective rebound in self-employment, there is little else to suggest that the other major components are poised to either unwind or extend their January moves. This uncertainty is also accentuated by the contrast between several high profile announcements of layoffs in the resource sector and recent surveys of hiring intentions that have shown a modest improvement. Note that if our forecast is realized, the six-month pace of employment will slip modestly from 9k to 6k which we view is consistent with conditions in the wider economy.
A more subdued labour market report would support our general view that USDCAD is trying to carve out a base after its sharp move lower in recent weeks. While the headlines surrounding surprisingly strong monthly GDP report for December have offered some reassurance on growth, we note that Canada’s overall momentum remains soft. Continued gains in oil prices will provide further support for the CAD, but US growth has started to show some signs of a spring thaw.”