Canada added jobs last month (+12.5k) and has rebounded from a surprise loss in the previous month. The gains were of a full-time variety (+36k), mostly in the public sector, but not enough to change the current unemployment rate (+7.2%). The private sector happened to shed jobs on the month (-20k).
No matter what positive print appeared, it was a healthy turnaround from March’s stunning loss of -54.5k positions. The Canadian economy year-to-date has shed a net -13.2k jobs, for an average monthly loss of -3.3k jobs. The important participation rate in the labor force fell to +66.5% from +66.6% or a mere 500 individuals. Despite the Canadian employment headline coming in a tad shy of expectations, the loonies reaction, an outright weakness versus the “mighty” dollar, has more to do with the ‘big dollar’ bullishness than the CAD.
Excluding the USD/CAD move, the buy North America trade is in full swing. The CAD is up against all the major crosses except the USD, led by CAD/JPY. Asian and London real money accounts have been trying to keep a lid on the USD. It’s not a surprise to see the loonie languish outright against the dollar as the currency was probably a bit overdone on the data alone – the market has been very much long CAD on the over zealous cross trading that has taken place over the last 24-hours. In the big picture, the loonies remains a fundamentally “decent story.”
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