TORONTO: The Canadian dollar strengthened by nearly a cent against its US counterpart on Friday following a surprisingly robust jobs report for Canada last month and solid US employment figures.
Canada added 43,100 new jobs in October, and the unemployment rate dropped to a nearly six-year low of 6.5 percent, according to Statistics Canada. Analysts were expecting a loss of 5,000 jobs on the heels of September's massive 74,100 gain.
The US labor market also grew at a brisk pace in October, adding 214,000 new jobs, and the unemployment rate fell to a six-year low of 5.8 percent, underscoring the world's largest economy's resilience in the face of slowing global demand.
"Overall, welcome good news for the Canadian dollar, because you're seeing good strength in Canadian jobs following a soft patch earlier this year, and continued strength in the US labor market that bodes well for spending on Canadian products," said Sal Guatieri, senior economist at BMO Capital Markets.
The Canadian dollar was at C$1.1364 to the greenback, or 88.00 US cents, stronger than Thursday's close of C$1.1426, or 87.52 US cents.
At one point, it hit C$1.1330, but the broader theme of a resurgent US dollar encouraged traders to buy on the dips.
"There's a lot of (US dollar) buying interest at mid-C$1.1350 or so, with a couple of little bounces on the way down here," said David Tulk, chief Canada macro strategist at TD Securities.
Canadian government bond prices were mixed across the maturity curve, with the two-year down 2.5 Canadian cents to yield 1.041 percent and the benchmark 10-year was up 9 Canadian cents to yield 2.075 percent.
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