Canadian Dollar Hangs onto Gains After Solid Employment Data

The Canadian dollar rallied today following the release of solid employment data from Canada. The currency has trimmed its gains by now but is still trading above the opening level. The loonie’s performance against the euro was different, though, as the Canadian dollar was unable to rise against the shared 19-nation currency.

Canadian employers added 15,300 jobs in February. While the increase was noticeably smaller than January’s 48,300, it was still far above the meager gain by 600 predicted by analysts ahead of the report. The unemployment rate demonstrated a surprise drop from 6.8% to 6.6%, though it was partly due to the decrease of the participation rate.

With the next week being extremely light on economic data from Canada, the Canadian currency is likely to be driven by events outside of the country, the Federal Reserve policy meeting in particular. Considering that market participants widely anticipate an interest rate hike at the meeting, the event is likely to be negative to the loonie.

USD/CAD was down from 1.3510 to 1.3424 intraday before bouncing to 1.3466 as of 18:47 GMT today. EUR/CAD rallied from 1.4286 to 1.4380, trading at the highest level since November 18. CAD/JPY advanced from 85.05 to 85.83 before pulling back to 85.23 later.

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