C$ firms as data shows payroll earnings accelerating

Parvez Jabri July 26, 2019

TORONTO: The Canadian dollar edged higher on Thursday against its US counterpart, as oil prices rose and data that showed domestic average weekly earnings rose in May at the fastest pace in 15 months.

Average weekly earnings of non-farm payroll employees were up 3.4% from the previous year, the highest year-over-year growth rate since February 2018, data from Statistics Canada showed.

The upward move in weekly earnings was accompanied by an increase of 32,600 in the number of non-farm payroll employees.

Meanwhile, the price of oil, one of Canada’s major exports, rose amid Middle East tensions and a big fall in US crude stocks. But prices faced downward pressure from weak manufacturing data in Western nations indicating slowing economic growth that could reduce fuel demand. US crude oil futures were up 1.3% to $56.63 a barrel.

At 10:41 a.m. (1441 GMT), the Canadian dollar was trading 0.1% higher at 1.3126 to the greenback, or 76.18 US cents. The currency, which hit its weakest intraday level in nearly one month at 1.3164 on Tuesday, traded in a range of 1.3115 to 1.3153.

The steady profile for the loonie came as European Central Bank President Mario Draghi offered a glimmer of optimism about his outlook on the euro zone economy, pressuring the US dollar against a basket of major currencies, including the euro.

Canadian government bond prices were lower across the yield curve, with the two-year down 4 Canadian cents to yield 1.448% and the 10-year falling 31 Canadian cents to yield 1.477%.

The 10-year yield touched its lowest intraday level since June 18 at 1.404%, while the gap between Canada’s 10-year yield and its US counterpart widened by 1.9 basis points to a spread of 61.9 basis points, the biggest gap since June 18.

Copyright Reuters, 2019

  • Leave a Reply

    Your email address will not be published. Required fields are marked *





    Close