Usdcad rises slightly amid stable us labor productivity and lower unit labor costs

USDCAD Analysis

Performance after Tuesday
Period	Pct	Chg	Momentum
Tuesday	0.02%	2.4 Pips
Week to-date	1.19%	166.4 Pips
December	1.23%	171.8 Pips

Upcoming key events (London Time)

Wed 01:30 PM USD CPI Inflation Rate (12-mth)
Wed 02:45 PM CAD Bank of Canada Policy Interest Rate
Wed 03:30 PM CAD Bank of Canada Press Conference
Thu 01:30 PM USD PPI excluding Food and Energy sectors (12-mth)

What happened lately

In the United States, the Bureau of Labor Statistics reported a decrease in Unit Labor Costs to 0.8% in the third quarter, down from 1.9% in the second quarter. This indicates that labor costs grew at a slower pace, which could suggest that inflationary pressures from rising wages are easing. Meanwhile, U.S. Nonfarm Business Labor Productivity remained stable at 2.2% in the third quarter, unchanged from the previous quarter. Steady productivity alongside lower unit labor costs may point towards a balanced economic environment where businesses are managing efficiencies without significant cost increases.

As for the impact on USDCAD, the marginal rise of 0.02% to 1.41790 on Tuesday was likely influenced by stable labor productivity and lower unit labor costs in the U.S. These factors may contribute to a stable dollar outlook. However, upcoming high-impact economic events could significantly influence the USDCAD pair. Anticipated reports like the U.S. Consumer Price Index (CPI) and the Producer Price Index (PPI) excluding Food and Energy sectors could provide insights into U.S. inflationary trends and economic health, potentially affecting dollar performance. Moreover, the Bank of Canada’s policy interest rate decision and associated press conference could create volatility. Any divergence in economic signals between Canada and the U.S. will be pivotal in determining the direction of USDCAD in the short term.

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What can we expect from USDCAD today?

USDCAD on Tuesday rose 0.02% to 1.41790. Price is above 9-Day EMA while Stochastic is rising.

Updated daily direction for USDCAD looks bullish as the pair ended higher after Tuesday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 1.41989 with break above could target R2 at 1.42189 or figure level area. While towards the downside, we are looking at daily low of 1.41510 as an important support. Break below this level could weaken the current bullish momentum. A break above 1.41949 may suggest continuation after recent positive movement.

For the week to-date, take note that USDCAD is bullish as the pair continued to trade higher and is up by 1.19% over the past few days.

Key levels to watch out:

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