U.S. Inflation and Employment in Canada

USA:

• Core Consumer Price Index (CPI) (m/m) (Apr), fact 0.1%, forecast 0.2%.
• Core Consumer Price Index (CPI) (y/y) (Apr), fact 2.1%, forecast 2.1%.
• Consumer Price Index (CPI) (m/m) (Apr), fact 0.3%, forecast 0.4%.

Canada:

• Construction permits (m/m) (Mar), fact 2.1%, forecast 2.8%.
• Change in employment (Apr), fact 106.5K, forecast 10.0K.
• Unemployment rate (April), fact 5.7%, forecast 5.8%.

U.S. inflation data fell short of market expectations and showed a slowdown in April. This heightened the market’s concerns about a slowdown in the US inflation, and as a result, it will increase the likelihood of Fed rate cuts in the future. Core consumer price index (CPI) of the United States on a monthly basis for the third consecutive month remains near the minimum values, keeping fears of a slowdown in inflation.

Fig. 1. U.S. core consumer price index (CPI)

Employment data in Canada showed an unexpected increase in employment to nine-year highs and a decrease in unemployment to multi-year lows. This indicates a significant increase in the labor market in Canada.

Fig. 2. Employment changes in Canada

Against the background of weak data on the US inflation and employment growth in Canada, the USD/CAD pair was under the considerable pressure, having updated a low at the level of 1.3400. This broke the formation of the ascending triangle, which was traced from the beginning of May. Such a rapid collapse of this pair limits its further reduction by oversold and support levels: 1.3380 and 1.3360. Resistance levels are located at the levels: 1.3440 and 1.3460.

Fig. 3. USD/CAD chart. The current price is 1.3400.

Read also: “Trading strategy on the news Erste News VS Other technologies”

Hanzenko Anton

---

Earn with the help of the trade service on the news Erste News!

Topical articles of the trader’s blog:

1. Skills each investor must develop
2. What is interesting about the US Fed meeting in April  and how it can affect the world banks policy?
3. Stock Indices: Storming Historic Highs

Current Investment ideas:

1. CAT shares give SUPER-opportunity to earn in April!
2. Hewlett-Packard shares are ready to close the gap, and we are ready to close the profits!
3. Several reasons to buy Walmart shares. Use the chance to earn!