The Canadian dollar rose against its broadly weaker U.S. counterpart on Monday as data showing a surge in U.S. employment bolstered investor sentiment, offsetting a drop in oil prices.
Global stock prices rose to a 1 1/2-month high after the U.S. labor department said on Friday that nonfarm payrolls surged by 916,000 jobs last month, the biggest gain since last August.
Canada sends about 75 per cent of its exports to the United States, including oil. U.S. crude oil futures were down 1.8 per cent at $60.37 a barrel as rising supply from OPEC+ and higher Iranian output countered signs of a strong economic rebound in the United States.
The Canadian dollar was trading 0.4 per cent higher at 1.2526 to the greenback, or 79.83 U.S. cents, having traded in a range of 1.2525 to 1.2594.
April has tended to be a seasonally strong month for the loonie. The currency has gained ground in eight of the last 10 Aprils.
Analysts have raised their Canadian dollar forecasts for the coming year, expecting the currency to benefit from faster growth in the domestic economy and a potential reduction by the Bank of Canada of its bond purchases, a Reuters poll showed.
The U.S. dollar fell against a basket of major currencies, after having posted its best quarter against major currencies in almost three years in January-March thanks to an improving U.S. economy and rising Treasury yields.
Canadian government bond yields were higher across a steeper curve, with the market reacting to the U.S. jobs data after it was closed for the Good Friday holiday. The 10-year rose 4.4 basis points to 1.557 per cent.
Canada’s trade report for February is due on Wednesday, while the March employment report is due on Friday.
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