CANADA’S FX DEBT – Canadian dollar recovers weekly loss as investors ignore drop in jobs


(Add details on activity, update prices) * The Canadian dollar strengthens 0.3% against the greenback * The Canadian economy sheds 68,000 jobs in May * The price of US oil s’ sets up 1.2% * Canadian bond yields ease on flatter curve By Fergal Smith TORONTO, Jun 4 (Reuters) – The Canadian dollar strengthened against its US counterpart on Friday as prices of the oil rose and investors weighed on jobs data in the US and Canada, with the currency recovering from its weakest intraday level in more than a week. The loonie was trading up 0.3% to 1.2075 against the greenback, or 82.82 cents US, having recovered from its lowest level since May 27 at 1.2133 earlier in the session. It is virtually unchanged for the week. Canada lost 68,000 jobs in May, a larger-than-expected drop, as closures imposed to curb a third wave of COVID-19 continued to weigh on the economy, according to Statistics Canada data. “Below the surface the number is a little better than it looks and overall the Canadian dollar will not be upset by a weak figure induced by the lockdown,” said Adam Button, chief analyst of currencies at ForexLive. The Canadian currency collapsed this year, supported by rising commodity prices and the more hawkish stance of the Bank of Canada. The central bank is due to make a decision on interest rates on Wednesday. Analysts have raised their outlook for the loonie as a proposed US infrastructure spending program boosts the outlook for the global economy, according to a Reuters poll. The price of oil, one of Canada’s top exports, rose 1.2% to $ 69.62 a barrel, as OPEC + supply discipline and picking up demand dampened concerns regarding the uneven deployment of COVID-19 vaccination around the world. The US dollar depreciated against a basket of major currencies after the US non-farm workforce increased less than expected, tempering expectations that the Federal Reserve will tighten monetary policy sooner rather than later. Canadian government bond yields were lower on a flatter curve, following the movement of US Treasuries. The 10-year fell 6 basis points to 1.460%, its lowest since May 26. (Report by Fergal Smith; edited by Jonathan Oatis)

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