Canada Dollar Rallies as U.S., Canada Jobs Gains Fuel Demand
The Canadian dollar rose versus its U.S. peer as domestic employers added five times more jobs than forecast, adding to speculation Bank of Canada Governor Mark Carney will raise its target interest rate.
The loonie, as the currency is nicknamed, strengthened to a one-week high after employers added 52,100 jobs in September, Statistics Canada reported in Ottawa. That exceeded forecasts for an increase of 10,000. A U.S. government report showed payrolls increased 114,000 and the unemployment rate unexpectedly dropped to 7.8 percent.
“The economic fundamentals of Canada are still pretty sound,” Steve Butler, director of foreign-exchange trading in Toronto at Bank of Nova Scotia’s Scotia Capital unit, said before the report. “A strong employment number gives support to the Bank of Canada’s stance that they would prefer to withdraw stimulus sooner rather than later.”
Canada’s currency appreciated 0.5 percent to 97.56 cents per U.S. dollar at 8:40 a.m. in Toronto, reaching the strongest level since Sept. 25. One Canadian dollar buys $1.0250.