TORONTO: The Canadian dollar strengthened against its U.S. counterpart on Wednesday as investors shrugged off economic data that pointed toward slowing global growth, with investors awaiting the U.S. nonfarm payrolls report later this week.

The loonie was trading 0.2% higher at 1.2590 to the greenback, or 79.43 U.S. cents. It traded in a range of 1.2580 to 1.2637.

Global factory activity lost momentum in August as the continuing coronavirus pandemic disrupted supply chains, raising concerns that faltering manufacturing would add to economic woes caused by slumping consumption, surveys showed.

But world stock markets climbed, with investors focusing on a likely continuation of massive central bank stimulus measures.

U.S. job figures are due on Friday, which could offer clues on the timing of the Federal Reserve’s asset purchase tapering.

The Bank of Canada is due to make an interest rate decision next week.

Data on Tuesday showed that Canada’s economy unexpectedly shrank in the second quarter and again in July, putting the economy at the center of debate three weeks ahead of a national election.