​VBCE Daily Foreign Exchange Update for Monday, Aug 29, 2016

USDCAD spot rate: 1.3020 - 1.3025 (as at 8:21am PST)

Ranges:

Asia:

1.3000

to

1.3017

Europe:

1.3004

to

1.3030

North America:

1.3025

to

1.3040

Technical Support / Resistance:

S2

S1

R1

R2

1.2760

1.2840

1.2950

1.3075

Key Economic Data Releases:

- U.S. Core PCE (Mom Jul) 0.01% (0.1% exp) 0.01% previous

Key Event Calendar:

Date

Canada

U.S.A.

Aug 30

Aug 31

Sept. 1

Sept. 2

Current account

GDP (June)

RBC mfg index

Trade balance

Consumer confidence

ADP employment, pending home sales, crude oil inventories

ISM manufacturing index

Non-farm payrolls, unemployment rate, Avg hourly earnings, trade balance

The CAD is trading quietly so far on the session, showing little change from Friday's levels. But USDCAD's move back, or a little above the 1.30 area looks fully justified considering the softness in crude oil and the move in short term interest rate spreads. Futures implied probability of a FED rate hike in September are at 42% this morning, and have risen to 2-1 for an increase by the end of the year following Chair Janet Yellen's speech at Jackson Hole on Friday. The monthly US payrolls due later this week will provide more clues on whether policy makers will have room to boost borrowing costs. Meanwhile there is no expectation that the BoC will be anywhere close to following any Fed tightening steps in the near-to-medium term. Currently, the TSX is up 0.18% and the Dow is also up 0.52%. EURCAD is up 0.22% trading between 1.4513 and 1.4578. GBPCAD is down 0.04% trading between 1.7001 and 1.7093. JPYCAD is up 0.10% trading between 0.01270 and 0.01277. Gold is up 0.06% trading between $1,315 and $1,322USD/oz., silver is down 0.09% trading between $18.39 and $18.67USD/oz., while oil is down 1.28% trading between $46.65 and $47.35.

Sources: Reuters, Bloomberg, FXStreet, RBC Capital Markets, Bank of Canada, U.S. Federal Reserve, CNBC, Forexlive

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The information and opinions contained herein are gathered from sources which are thought to be reliable but the reader should not assume that the information and opinions are official or final. VBCE makes no warranty concerning the accuracy of the information and opinions, and accepts no liability for the consequences of any actions taken on the basis of the information and opinions provided. The content is for general information only and does not constitute in anyway giving financial advice.