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Loonie closes sharply lower on weak jobs report

Canadian dollars (loonies) are pictured.


The Canadian dollar closed sharply lower Friday as jobs data for April showed a big decrease in employment.

The loonie fell 0.62 of a cent to end at 91.78 cents (U.S.) as Statistics Canada reported that the economy lost a net 28,900 jobs last month against expectations of a gain of about 12,000. It was also a huge turnaround from March, when the economy cranked out 43,000 jobs, which means just 14,000 jobs were added over the two-month period.

The unemployment rate held steady at 6.9 per cent.

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The participation rate was a bit lower than expected, coming in at 66.1 per cent versus the 66.3 per cent rate that economists had forecast.

The Canadian dollar had charged ahead almost two-thirds of a cent Thursday to a four-month high in the wake of a positive reading on housing starts.

Markets had also been encouraged by China's April trade data that showed an improvement in exports. Exports rose 0.9 per cent from the previous year, compared with a 6.6 per cent decline in March. Imports also grew after a contraction in March but at a subdued level.

On the commodity markets, July copper was up 2 cents to $3.08 a pound amid positive inflation news from China.

Consumer prices in the world's second-largest economy rose 1.8 per cent from a year earlier, down from March's 2.4 per cent increase, giving the government more leeway if needed to stimulate the slowing economy.

Oil prices gave up early gains and June crude declined 27 cents to $99.99 a barrel.

June gold bullion faded a dime to $1,287.60 an ounce.

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