Market Brief March 7th: Canada interest rate decision due
AUD, 00:30 a.m. GMT, GDP (QoQ) (Q) – Gross Domestic Product measures the change in the total value of goods and services produced for the 4th quarter. Projections lean toward a decrease at 0.5% compared to 0.6% for the previous 3rd quarter. Should the actual reading come out considerbly better than expected, this should boost the value of the Aussie. Converesely, a much lower than projected reading could decrease the price of the asset.
USD, 13:15 p.m. GMT, ADP Nonfarm Employment Change (Feb) – this number is often (note, not always) indicative of the NFP number to come out on the first Friday of the month. As you know the Nonfarm payrolls number is a time of high volatilty with a substantial number of traders monitoring action closely.
So, the prediction in ADP us for a decrease in the number of people employed in February at 195K versus 234K. If the number is reported to be better than projected, this should be viewed as a bullish sign for the U.S. dollar while a much weaker reading could bring down the currency.
CAD, 15:00 p.m. GMT, BoC Interest Rate Decision – this is one of the most important events for a currency. Interest rate decisions have a long-term impact on currencies and they are a result of the overall state of the economy. So, market analyst forecasts predict no change and for the rate to remain at 1.25%. If however, there is a surprise and there is a cut (bearish for the Loonie) or a raise in the rate (i.e. bullish), the reaction will be immediate and probably could have a long-term effect.
USD, 15:30 p.m. GMT, Crude Oil Inventories – the change in the number of inventories over the past week will show us if prices of the commodity are likely to increase or vice versa. If the supply of inventories has increase, this should lead to a drop in demand, and thus lower prices. And, if there is a shortage of inventories, this is to be viewed as a potential for higher demand and thus higher prices. Expectations are for a minor decrease in supply at 3.000M versus 3.019M barrels last week.
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