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Canadian dollar rises on stronger-than-expected June jobs data
USD/CAD fell to a more than two-week low near 1.4136 after Canada added 18.2K jobs in June, beating expectations of 10K.
The Canadian dollar strengthened versus the US dollar after Canada’s June labor market report beat forecasts, lifting demand for the CAD and pulling USD/CAD lower. At the time of writing, USD/CAD traded around 1.4160 after dropping to a more than two-week low of 1.4136.
Statistics Canada said the economy added 18.2K jobs in June, compared with expectations of 10K, though the result followed a sharp slowdown from May’s 87.8K increase. The unemployment rate eased to 6.5% from 6.6%.
With labor market conditions described as uneven, the Bank of Canada is expected to keep a wait-and-see stance and leave interest rates unchanged in coming months while monitoring inflation risks, including those linked to higher energy prices.
Oil prices rose earlier in the week following renewed Middle East hostilities, supporting the commodity-linked CAD and putting USD/CAD on track for its first weekly loss in six weeks. Oil gains were later pared as diplomatic efforts to de-escalate continued, while traders also looked ahead to next week’s US CPI data for clues on the Federal Reserve’s policy path.