The Canadian dollar surged today as the domestic employment report was amazingly good, while poor non-farm payrolls in the United States reduced concerns about stimulus reduction by the US central bank, adding to the strength of the currency.
Canadian employers added as much as 59,000 jobs in August after the July’s drop by 39,400. The actual reading was a way above the forecast of 21,200. Moreover, the unemployment rate unexpectedly slipped by 0.1 percentage point to 7.1 percent.
The worse-than-expected expected US employment data helped the loonie to demonstrate a massive rally against the US dollar. Usually, negative news from the USA, the biggest trading partner of Canada, is not good for the Canadian currency. Yet currently bad US indicators mean smaller chances for quantitative easing tampering and this is positive for the most currencies.
USD/CAD slumped from 1.0502 to 1.0399 as of 18:08 GMT today, reaching the low of 1.0381 intraday — the weakest since August 20. EUR/CAD declined from 1.3718 to 1.3687 following the drop to 1.3646. Meanwhile, CAD/JPY traded sideways at 95.35.
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