CAD Weakens After Canadian Job Losses

The Canadian dollar weakened against most of its major peers after the nation unexpectedly lost jobs last month, bolstering the case the central bank made earlier this week for waiting to raise interest rates.

The currency fell for the first time in three days versus its U.S. counterpart after Canada said it lost 11,000 positions in August, compared with the 10,000 gain forecast in a Bloomberg economist survey and the 41,700 added the month before. The Bank of Canada refrained this week from raising interest rates and maintained a neutral view on its next move, saying recent strength in exports would have to be sustained to ensure broader economic growth.

“It probably confirms their neutral bias going forward,” said Shaun Osborne, chief currency strategist at Toronto-Dominion Bank, in a phone interview.

The loonie, as the Canadian dollar is called for the image of the aquatic bird on the C$1 coin, lost 0.1 percent to C$1.0885 per U.S. dollar at 8:48 a.m. in Toronto. One loonie buys 91.87 U.S. cents.

Employers in the U.S., Canada’s largest trading partner, added the fewest jobs this year in August, representing a pause in the recent momentum of the U.S. labor market as companies assess the prospects for demand.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza