Loonie Pares Decline on Canadian Jobs Report

The Canadian dollar pared losses after a report showed the economy lost fewer jobs than forecast last month.

Nationwide employment fell by 1,000 positions, and the jobless rate rose to 6.8 percent, the highest since September, from 6.6 percent in January, Statistics Canada said Friday in Ottawa.

Economists surveyed by Bloomberg News expected a decline of 5,000 jobs and a 6.7 percent jobless rate. “A lot of those negative expectations in the labor market have been forwarded for now,” Greg Moore, senior currency strategist at Royal Bank of Canada, said by phone from Toronto before the data. “The expectation generally out there is that there’s still a lot of give back to be seen in those numbers.”

The currency fell 0.4 percent to C$1.2739 per U.S. dollar at 8:34 a.m in Toronto. It touched C$1.2799 per U.S. dollar Jan. 30, the lowest since April 2009.

The data suggest the effects of falling oil prices are beginning to show up in the nation’s employment market. Jobs in the natural resource sector were down 16,900 last month. Alberta, home to the bulk of Canada’s proven oil reserves, posted a 14,000 decline in employment and its highest jobless rate since 2011, rising 0.8 percentage points to 5.3 percent.

The Bank of Canada unexpectedly cut its benchmark interest rate to 0.75 percent from 1 percent in January, calling the move “insurance” to support the economy against the negative effects of lower oil prices.

Bloomberg

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell