TORONTO: The Canadian dollar weakened to a three-week low against its US counterpart on Friday as signs that trade tensions are hurting employment bolstered expectations for additional interest rate cuts from the Bank of Canada.
The loonie was trading 0.1% lower at 1.3935 per US dollar, or 71.74 US cents, after touching its weakest intraday level since April 16 at 1.3944.
For the week, the loonie was down 0.8%, with the currency pulling back from a near seven-month high on Tuesday at 1.3748.
Canada’s unemployment rate rose to 6.9% in April, the highest level since November and above the 6.8% rate economists had expected, as the economy added just 7,400 jobs.
“Tariff uncertainty is now weighing on employment, and we see little chance these worries will fade in the near future,” said Nick Rees, senior FX market analyst at Monex Europe Ltd.
“We see little reason that this jobs data should stand in the way of further BoC policy easing in June, and that leaves loonie risks skewed to the downside as traders price this in.”
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