The Canadian dollar dropped against its US peer and the Japanese yen as a set of poor fundamental data was released today. The currency managed to trim its losses against the yen and advance versus the greenback as well as the euro.
Canada’s employment was unchanged (demonstrated zero percent change) in May. Canadian employers added just 7,700 jobs last month, compared to 58,200 in the month before. Trade balance posted an unexpected deficit of C$367 million in April. Jim Flaherty, Canada’s Minister of Finance, said that the country can bolster liquidity in its own financial system in case the global economic situation demands it.
Forex market analysts noted that general negative mood of traders had, perhaps, stronger impact on the loonie (as the Canadian currency usually nicknamed because of the image of an aquatic bird on C$1 coin) that domestic fundamentals. Poor macroeconomic data from the European Union and concerns that Spain might require a rescue weakened demand for commodity currencies. As for positive news, Mark Carney, Bank of Canada’s Governor, reiterated this week that an interest rate hike may become warranted as the economy recovers. Whatever the case, the loonie managed to recover after the initial losses.
USD/CAD was at 1.0278 as of 19:20 GMT today after climbing from 1.0282 to 1.0353. EUR/CAD was down from 1.2912 to 1.2858. CAD/JPY traded at about 77.26, following the earlier drop from 77.39 to 76.39.
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