The US dollar remains pinned near monthly lows of 1.3930 on Friday, heading for a 0.2% weekly decline, after another 0.9% decline in the previous week, with all eyes on Canada’s employment numbers and US PCE price index releases, due later today.
Recent US employment data has strengthened the case for an interest rate cut by the Federal Reserve next week. The ADP employment report showed an unexpected decline in net payrolls in November, and Challenger job cuts revealed a sharp decline in layoffs last month, but it also said US companies froze their hiring plans amid the uncertain economic context.
On the positive side, initial jobless claims in the US fell to a three-year low of 191,000 in the last week of November, although the data was taken with a grain of salt, on the assumption that the Thanksgiving holiday may have distorted the true numbers.
The unemployment rate in Canada is expected to rise
The Canadian calendar was light this week, and investors are focusing on November employment numbers. Net employment is expected to fall by 5,000 in November, after an increase of 66,600 in October, and the unemployment rate is expected to rise to 7%, from 6.9% the previous month.
However, these numbers are unlikely to change the view that the Bank of Canada (BoC) will keep interest rates unchanged next week, after two successive rate cuts in September and October.
In the US, the Personal Consumption Expenditures (PCE) price index is expected to confirm that inflation remains steady at levels above the Fed’s target rate. PCE inflation is expected to accelerate to a 2.9% annual rate in November, from 2.8% in October, while the core CPI is expected to grow steadily at a 2.9% annual rate. Likewise, these numbers are unlikely to change the view that the Fed will cut interest rates by a quarter of a percentage point next week.
Economic indicator
Unemployment rate
Unemployment rate issued by Statistics Canadais the number of unemployed workers divided by the total civilian labor force as a percentage. It is a leading indicator of the Canadian economy. If the rate rises, it indicates a lack of expansion within the Canadian labor market and a weakness in the Canadian economy. Generally, a decrease in the number is viewed as bullish for the Canadian Dollar (CAD), while an increase is viewed as bearish.
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Next release:
Friday 05 December 2025 at 13:30
repetition:
monthly
consensus:
7%
former:
6.9%
source:
Statistics Canada
Economic indicator
Core Personal Consumption Expenditures – Price Index (annual)
Core personal consumption expenditures (PCE), issued by US Bureau of Economic Analysis On a monthly basis, it measures changes in the prices of goods and services purchased by consumers in the United States. The Personal Consumption Expenditures Price Index is also the Fed’s preferred measure of inflation. The annual reading compares commodity prices in the reference month with the same month of the previous year. The core reading excludes the more volatile so-called food and energy components to give a more accurate measure of price pressures.
Read more.
Next release:
Friday 05 December 2025 at 13:30
repetition:
monthly
consensus:
2.9%
former:
2.9%
source:
US Bureau of Economic Analysis
Following the publication of the GDP report, the US Bureau of Economic Analysis releases personal consumption expenditures (PCE) price index data along with monthly changes in personal spending and personal income. Policymakers at the Federal Open Market Committee use the core annual personal consumption expenditures price index, which excludes volatile food and energy prices, as their main measure of inflation. A stronger than expected reading may help the US dollar outperform its rivals, as this may indicate a possible hawkish shift in the Fed’s future guidance and vice versa.
