Loonie Falls After Disappointing Canada Jobs Data
May 11 2018 - 4:36AM
RTTF2
The Canadian dollar declined against its key counterparts in the
European session on Friday, as a data showed that the economy
unexpectedly shed jobs in April.
Data from Statistics Canada showed that the employment declined
by 1,100 jobs in April, after rising by 32,300 jobs in March.
Economists had expected the employment to increase by 20,000
jobs.
The unemployment rate remained at 5.8 percent, matching
expectations.
Meanwhile, crude oil prices remained at 4-year highs on reports
that Saudi Arabia may end their supply quota plan with fellow OPEC
members and Russia in the wake of the Iran sanctions issue.
Supply disruptions from Iran could result in another significant
jump in oil prices, to the benefit of the booming U.S. shale oil
industry.
The loonie rose against its most major rivals in the Asian
session amid rising appetite, as tepid U.S. inflation data eased
worries about a faster pace of rate hike by the Federal
Reserve.
Pulling away from an early high of 85.87 against the yen, the
loonie edged down to 85.52. Next key support for the loonie is
likely seen around the 84.00 level.
Following a 3-week high of 1.2729 hit at 8:15 am ET, the loonie
reversed direction and weakened to 1.2775 against the greenback.
The loonie is likely to find support around the 1.29 level.
Data from the Labor Department showed that U.S. import prices
increased less than expected in April, although the export prices
grew stronger than expected.
The Labor Department said import prices rose by 0.3 percent in
April after edging down by a revised 0.2 percent in March.
The loonie slipped to a 2-day low of 1.5259 against the euro,
after having advanced to 1.5178 at 2:30 am ET. If the loonie
continues its fall, 1.54 is possibly seen as its next support
level.
The loonie reversed from an early high of 0.9604 against the
aussie, declining to a 2-day low of 0.9652. The next possible
support for the loonie is seen around the 0.98 mark.
Looking ahead, the University of Michigan's preliminary consumer
sentiment index for May is scheduled for release shortly.
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