USD/CAD has recorded slight gains on Thursday, after posting strong losses on Wednesday. Currently, the pair is trading quietly at 1.3534, up 0.19% on the day. On the fundamental front, there were strong numbers on both sides of the border.
Canada ADP Nonfarm Payrolls sparkles
Canada created 953 thousand jobs in June, and the ADP nonfarm payrolls report followed suit and a glowing release. The report found that employment increased by 1.042 million, another sign that the employment sector is rapidly improving.
On Wednesday, the Bank of Canada held rates at 0.25%. Governor Tiff Macklem said that the bank would not raise rates until inflation rises to the bank’s target rate of 2 percent. That could take some time – the BoC is forecasting inflation at 0.6% in 2020 and 1.2% in 2021. The bank also forecast that GDP would contract 6.8% this year before rebounding by 4.9% in 2021.
In the US, there was good news as retail sales climbed 7.5%, beating the estimate of 5.0%. This was a second successive gain after three straight declines. The core reading also looked sharp, with a gain of 7.3%.