The USD/CAD pair extended its drop during last week, as the U.S. dollarâ€™s weakness pushed the pair further to the downside, where the Fed confirmed that they will continue with the extra loose monetary policy, which sent the U.S. dollar tumbling across the board, while slower growth in the first quarter of 2011 also weigh down on the U.S. dollar, nevertheless, the pairâ€™s drop was limited after Canadaâ€™s GDP showed the economy unexpectedly contracted in February, which trimmed earlier losses.
The USD/CAD pair should continue to drop over the upcoming period, although we donâ€™t exclude to witness some upside correctional waves, nevertheless, the expected weakness of the U.S. dollar will probably push the pair to the downside, noting that this week, the U.S. Labor Department will release the infamous jobs report, which will be the major highlight of the week.
Highlights for this week that will probably affect the USD/CAD pairâ€™s direction are:
Monday 12:30, Canada will release the Industrial Product Price index for the month of March, where industrial product prices increased by 0.7% in February, also, the Raw Materials Price index will be released for March, where raw materials prices rose in February by 1.8%, reflecting mainly the rise in energy prices.
Monday 14:00, the United States will release the ISM Manufacturing index for the month of April, where the ISM manufacturing index is expected to ease to 60.1 in April, compared with the prior estimate of 61.2 reported back in March.
Tuesday 14:00, the United States will release the Factory Orders index for the month of March, where factory orders are expected to rise by 1.6%, following the prior decline of 0.1% in February.
Wednesday 12:215, the United States will release the ADP Employment Change report for the month of April, where the ADP employment is expected to show that U.S. private employers added 198,000 jobs in April, compared with the prior reported rise of 201,000 added jobs back in March, the ADP reports is important since itâ€™s released two days ahead of the Non-farm payrolls.
Wednesday 14:00, the United States will release the ISM Non-Manufacturing (Services) index for the month of April, where the ISM Non-manufacturing index is expected to rise to 58.0 in April, compared with the prior estimate of 57.3 reported back in March, where the recovery in the services sector seems to be picking up some pace.
Thursday 12:30, Canada will release the Building Permits index for the month of March, where building permits rose by 9.9 percent in February, and investors will hope activities in the Canadian housing market continued to improve.
Thursday 12:30, the United States will release the Nonfarm Productivity preliminary estimate for the first quarter of 2011, where Nonfarm productivity is expected to rise by 0.5% only, compared with the prior rise of 2.6% in the fourth quarter, as economic growth eased in the first quarter, while Unit Labor Costs are expected to rise by 0.8%, compared with the prior drop of 0.6%.
Thursday 12:30, the United States will release the Jobless Claims for the week ending April 30, where jobless claims rose last week to 429,000, where conditions in the labor market are still improving over a gradual pace.
Thursday 14:00, Canada will release the Ivey PMI for the month of April, where Ivey PMI reached 73.2 in March.
Friday 11:00, Canada will release the jobs report for the month of April, where the Net Change in Employment declined in March by 1.5 thousand jobs, and conditions in the Canadian labor market seem to be improving recently. The Unemployment Rate was 7.7 percent in March.
Friday 12:30, the United States will release the jobs report for the month of April, where Non-farm payrolls are expected to rise by 193,000 jobs in April, compared with the prior rise of 216,000 added jobs in March, while the Unemployment Rate is expected to remain unchanged at 8.8 percent.
Originally posted here
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