Canadian dollar pads weekly gain as investors look past jobs plunge By Reuters


© Reuters.

* Canadian dollar rises 0.2% against the greenback

* Canada’s economy sheds 2 million jobs in April

* touches a one-week high at 1.3907

* Canadian bond yields trade mixed across a steeper curve

By Fergal Smith

TORONTO, May 8 (Reuters) – The Canadian dollar added to the week’s rally against its U.S. counterpart on Friday as signs of easing U.S.-China frictions bolstered investor sentiment and domestic data showed a plunge in jobs that was about half the number expected.

The Canadian dollar CAD=D4 was trading 0.2% higher on the day at 1.3938 to the greenback, or 71.75 U.S. cents. The currency touched its strongest intraday level since April 30, at 1.3907, and was up 0.8% for the week.

“I think this is mostly a risk-on story,” said Kurt Reiman, chief Canadian investment strategist at BlackRock (NYSE:). “It has been another decent week for equity markets globally, oil prices have been turning higher.”

“The mood is partly a function of the news about phased reopenings of the economy, but also a bit more positive mood music on the U.S.-China trade front,” Reiman said.

Top U.S. and Chinese trade representatives discussed their Phase 1 trade deal, with China saying they agreed to improve the atmosphere for its implementation and the United States saying both sides expected obligations to be met. runs a current account deficit and is a major producer of commodities, including oil, so the country’s currency tends to be sensitive to the global flow of trade and capital.

Global share markets .WORLD climbed to weekly highs, while U.S. crude oil futures were up 3.8% at $24.44 a barrel, notching a second straight week of gains. lost a record-breaking 2 million jobs in April, when non-essential business was halted across the country to help contain the coronavirus pandemic. That was half the 4 million jobs decline that economists had expected, but the data did not capture 1.1 million people who have temporarily lost their jobs and expected to return to work once restrictions were relaxed. as bad a feared, but still a terrible report as the contraction in the job market accelerated in April amid a full month of lockdowns,” said Ryan Brecht, a senior economist at Action Economics.

Ottawa, which is rolling out about C$300 billion in economic support measures, said it would extend a wage subsidy program beyond June.

The U.S. economy, where Canada sends about 75% of its exports, also lost fewer jobs in April than feared.

Canadian government bond yields were mixed across a steeper curve, with the 10-year yield up 3.4 basis points at 0.583%.

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