Canadian Dollar Drops Against US Dollar on Disappointing Jobs Report

The Canadian dollar today registered a significant loss against its American counterpart following the release of Canada’s April employment report in the early North American session. The loonie was stronger against the greenback in the Asian to mid-European sessions backed by the weakening US dollar following yesterday’s mixed US CPI report.

The USD/CAD currency pair today rallied from a low of 1.2726 to a high of 1.2795 after the disappointing Canadian jobs report.

The currency pair was on a downtrend from the Asian session driven by yesterday’s soft US data. The higher crude oil prices as tracked by the West Texas Intermediate also contributed to commodity-linked Loonie’s initial rally. However, the release of the Canadian employment report for April by Statistics Canada was the main trigger behind the currency pair’s rally. According to the report, Canada lost a total of 1,100 jobs in April, which was against an expected gain of 17,400 jobs. However, the country’s unemployment rate met expectations by coming in at 5.8%. Furthermore, the country added 28,800 full time jobs and hourly earnings increased by 3.3%.

The weak US import price index released today had a muted impact on the currency pair. However, the positive University of Michigan consumer sentiment survey, which came in at 98.8 versus the expected 98.3 could have contributed to the currency pair’s rally.

The currency pair’s future performance is likely to be affected by political events in the US, and global crude oil prices given the upcoming weekend.

The USD/CAD currency pair was trading at 1.2792 as at 15:29 GMT having rallied from a low of 1.2726. The CAD/JPY currency pair was trading at 85.51 having dropped from a high of 85.86.

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