Statistics Canada is scheduled to release crucial employment data for March, which is going to elucidate the current state of the Canadian labour market.
The preliminary market forecasts differ drastically in their estimations of the likely surge in unemployment due to the coronavirus, and that is why the ambiguity surrounding the report is likely to cause a massive rise in volatility on the USDCAD pair around the time of the unemployment data’s release.
At present, the Canadian unemployment rate is at 5.6 per cent, but that number is almost certain to rise as the industry starts to feel the strain from the pandemic.
Unemployment Rate. Image source: TradingEconomics.com
The Canadian government imposed a national lockdown before such measures were implemented in the US, which means that local businesses have been struggling to function at times of a national emergency for longer.
Even so, comparing the Canadian labour market to its American counterpart would not be especially telling, given the massive underlying differences between the two.
Nevertheless, drawing such parallels could underpin the challenges that the Canadian labour force is currently facing.
Thursday’s unemployment data is likely to prompt heightened price action on the USDCAD, which is currently consolidating in a narrow range just above the 23.6 per cent Fibonacci retracement rate at 1.40976.
The latter is serving as a crucial support level.
USDCAD 4H Price Chart. Image source: Trendsharks ©, created with TradingView.com
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