The Canadian dollar strengthened to a more than one-week high against its US counterpart on Friday, boosted by higher oil prices and improved risk appetite, while domestic data showed a weaker-than-expected jobs gain in March. The price of oil, one of Canada's major exports, rebounded from two days of declines as Wall Street climbed on strong US jobs data, while investors also grew hopeful that a planned meeting between US President Donald Trump and North Korea's Kim Jong Un could ease geopolitical tensions.
US crude oil futures settled 3.2 percent higher at $62.04 a barrel. "With the risk-on trade today, with North Koreans coming to the negotiating table ... we have our currency doing better," said Hosen Marjaee, senior managing director, Canadian fixed income at Manulife Asset Management.
The Canadian economy added 15,400 jobs in February after a big loss in January, but full-time positions shrank and wage growth decelerated, prompting analysts to predict the Bank of Canada will be in no rush to raise interest rates. The central bank has raised benchmark interest rate three times since July to 1.25 percent but money markets don't expect another rate hike until the summer. At 4 pm EST (2100 GMT), the Canadian dollar was trading 0.6 percent higher at C$1.2816 to the greenback, or 78.03 US cents.
The currency touched its strongest level since March 1 at C$1.2815. For the week, the loonie gained 0.5 percent. Canadian government bond prices were lower across the yield curve, with the 10-year falling 34 Canadian cents to yield 2.271 percent. The yield touched its highest intraday since Feb. 28 at 2.274 percent.