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The USD/CAD pair trades in negative territory around 1.4020 during the early Asian session on Friday. The US Dollar (USD) remains under renewed selling pressure as traders prefer to wait on the sidelines ahead of the US and Canadian labor market reports, which are due later on Friday.Data released by the US Department of Labor on Thursday showed that the US weekly Initial Jobless Claims for the week ending November 29 rose 9,000 to 224,000, compared to 215,000 (revised from 213,000) in the previous week. This reading came in above the market consensus of 215,000. The Greenback edges lower in an immediate reaction to the US jobless claims data.
The market might turn cautious ahead of the crucial US labor market data, including Nonfarm Payrolls (NFP) and the Unemployment Rate. The NFP is expected to increase by 200,000 jobs in November after rising by 12,000 in October, the lowest number since December 2020. Additionally, the Unemployment Rate is forecasted to rise to 4.2% in November from 4.1% in October.
On the Loonie front, the threat of US trade tariffs might dampen the outlook for Canada’s export-dependent economy, which drags the Canadian Dollar (CAD) lower against the USD. “If the U.S. puts tariffs of upwards of 25% on Canada, the main adjustment that would take place would likely be through the currency,” said Benjamin Reitzes, Canadian rates & macro strategist at BMO Capital Markets. More By This Author:Australian Dollar Remains On The Defensive As Weaker Data Spurs RBA Rate Cut Speculation Japanese Yen Struggles To Gain Ground Ahead Of Jibun Bank Services PMI Data XAG/USD Remains Capped Below $31.00, Further Consolidation Cannot Be Ruled Out
