Canadian Dollar Gets Boost on Employment Gains
Canadian dollar is getting a boost today against the US dollar as employment news turns out more positive than expected. Loonie is higher against its US counterpart on the good news, even as risk aversion in general weighs on other high beta currencies.
Canadian dollar is heading higher today, thanks to a strong employment report. According to Statistics Canada, employment rose to 58,200 in April. This came on the heels of a jump of 82,300 in March. The good news is supporting the idea of a relatively strong Canadian economy — especially when compared against the US economy.
Additionally, some analysts and Forex traders are seeing this news as an argument in favor of boost the interest rate. So far, the Bank of Canada has been reluctant to raise borrowing costs. Now, with evidence of economic growth, some hope that interest rates can be raised in order to keep inflation in check. Higher rates would make the loonie even more attractive versus the greenback.
For now, the loonie is bucking a trend. Other high beta currencies, like the pound and the euro, are losing ground to the US dollar on difficulties in Greece and worries about JP Morgan Chase losses due to the London Whale.
At 13:41 GMT USD/CAD is down to 0.9982 from the open at 1.0021. GBP/CAD is down to 1.6051 from the open at 1.6180.
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Earlier News About the Canadian Dollar:
- Loonie Looks Stronger, Employment Data May Weaken Currency (2012-05-10)
- Canadian Dollar Steady Today (2012-05-07)
- Loonie Slips after Seeing Earlier Gains (2012-05-04)
- Loonie Gains vs. Euro, Holds Ground vs. Greenback & Yen (2012-05-02)
- Canadian Dollar Goes Higher as US Manufacturing Expands (2012-05-01)