By Commodity News Service Canada
WINNIPEG, July 11 – The Canadian dollar was sharply lower relative to the US dollar on Friday, reacting to disappointing Canadian employment data, analysts said.
Statistics Canada reported that 9,400 jobs were lost in Canada last month, while pre-report expectations called for an increase of 24,000 new jobs. The unemployment rate rose to 7.1 per cent, from 7.0 per cent in May.
The Canadian dollar closed at US$0.9316 or US$1=C$1.0734 on Friday, which compares with Thursday’s North American settlement of US$0.9392 or US$1=C$1.0647.
Talk that the disappointing Canadian employment data may cause the Bank of Canada to take a more dovish bias on the economy next week was also bearish.
A weaker tone in gold prices, and sharply lower crude oil values also spilled over to weigh on the value of the Canadian currency.
Canadian bonds closed higher, lifted by the surprising news that Canada lost jobs in June, market watchers said.
The two-year bond yielded 1.106% late Friday, from 1.120% late Thursday. The 10-year bond yielded 2.213%, from 2.238%. Bond yields fall as their prices rise.
