Market News

Loonie hits 2-week low as Canada sheds jobs - REUTERS

AUGUST 05, 2022

   * Canadian dollar weakens 0.8% against the greenback
    * Touches its weakest since July 19 at 1.2984
    * Price of U.S. oil falls 1.1%
    * 10-year yield falls below equivalent U.S. rate

    TORONTO, Aug 5 (Reuters) - The Canadian dollar fell to its
lowest level in more than two weeks against its U.S. counterpart
on Friday as oil prices extended recent declines and data showed
that Canada's economy shed jobs for a second straight month in
    Statistics Canada reported 30,600 positions were lost,
missing analyst expectations for an increase of 20,000.
    In contrast, U.S. employers hired far more workers than
expected in July, providing the strongest evidence yet that the
world's biggest economy was not in recession, and boosting the
U.S. dollar        against a basket of major currencies.
    After the two sets of job reports, money markets continued
to fully price in a half-percentage-point interest rate hike by
the Bank of Canada next month to fight inflation and see about a
two-thirds chance of an even larger move of three quarters of a
percentage point.           
    The Canadian dollar        was trading 0.8% lower at 1.2970
to the greenback, or 77.10 U.S. cents, after touching its
weakest since July 19 at 1.2984.
    The price of oil, one of Canada's major exports, dropped to
its lowest in six months as concerns over a possible fall in
fuel demand continued to rattle markets. U.S. crude oil futures
       were down 1.1% at $87.59 a barrel.             
    Canadian government bond yields were higher across the
curve, tracking the move in U.S. Treasuries.
    The 10-year             was up 7.3 basis points at 2.756%
but falling 7 basis points below the yield on the equivalent
U.S. bond.

 (Reporting by Fergal Smith; Editing by Susan Fenton)


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