The Canadian dollar was lower late morning Friday as a worsening in the standoff between Ukraine and Russia sent traders looking for safety.The loonie was down 0.09 of a cent to 91.63 cents US after Ukraine’s president says most of the Russian military vehicles that crossed into the country during the night have been destroyed.
There had been earlier reports from some Western journalists that Russian armoured personnel carriers were seen crossing into Ukraine near the point where a Russian aid convoy was parked.
The yield on the benchmark 10-year U.S. Treasury fell to 2.326 per cent, down from 2.375 per cent earlier in the morning. December bullion halved earlier losses. However, gold was still down $9.30 to US$1,306.40 an ounce.
The dollar had gone as high as 92 cents earlier in the morning as revised Canadian jobs data for July blew past expectations.
Statistics Canada reported that the economy added 42,000 positions last month. Economists had generally expected that about 20,000 jobs were created during July.
The federal agency had said earlier this week that it had discovered an error in its jobs data originally released last Friday, showing the economy added a meagre 200 jobs.
The agency says the error resulted from a major redesign of its market-moving Labour Force Survey that occurs every 10 years when one program was not updated, which it calls a human error. The mistake resulted in Statistics Canada overestimating full-time job losses.
The loonie had also advanced amid solid manufacturing numbers.
Statistics Canada also reported that manufacturing sales rose 0.6 per cent in June to $52 billion, the fifth gain in six months. The gain stemmed from a three increase in non-durable goods sales, led by the chemical, petroleum and coal product as well as the food industries.
The agency added that lower sales in the motor vehicle industry offset a portion of the gains in June. Sales in the industry were down 8.6 per cent to $4.5 billion, the first decrease following two months of strong gains.
The mood on financial markets had been positive earlier as traders had thought there was a further easing of tensions in the Russia-Ukraine standoff.
Russia had let Ukrainian officials inspect an aid convoy on Friday and agreed to let the Red Cross distribute the aid around the rebel-held city of Luhansk. Ukraine had said it was worried that the aid operation was a ruse to get military help to separatist rebels.
Markets had been further reassured after Russia’s President Vladimir Putin appeared to tone down his rhetoric on Ukraine Thursday, saying that Russia’s goal was “to stop bloodshed in Ukraine as soon as possible.”
Elsewhere on commodity markets, September crude in New York was ahead $1.14 to US$97.86 a barrel.
September copper gained a penny to US$3.10 a pound.