Canadian dollar rests near 12-month high
By Claire Sibonney
TORONTO (Reuters) - The Canadian dollar hovered at a one-year high versus the U.S. dollar on Monday, buoyed by last week's strong domestic employment report and hopes of more policy easing in the United States.
Canada on Friday reported the economy added 34,300 jobs in August, topping all expectations of analysts surveyed by Reuters. Canada has recouped all the jobs lost in the recession, and employment stands 176,600 higher than in August 2011, with most of the increases in full-time positions.
By comparison, U.S. jobs growth slowed sharply in August, with nonfarm payrolls up only 96,000, well below what would normally be needed to put a dent in the jobless rate and setting the stage for the Fed to pump additional money into the sluggish economy when it meets later this week.
At 8:20 a.m., the Canadian dollar stood at C$0.9770 against the greenback, or $1.0235, slightly firmer than Friday's North American session close at C$0.9782, or $1.0223.
Earlier on Monday, it touched C$0.9766, or C$1.0240, matching Friday's high and the strongest level since September 19, 2011.
"We're of the opinion that it may not well be so much of a done deal that the Fed does more QE, so it may be the case that at these sort of levels there's potentially some small opportunities just to add to some dollar/CAD long positions on the basis that the U.S. dollar may well get a little bit of a post-Fed bounce," said Jeremy Stretch, head of currency strategy at CIBC in London.
Stretch said firm Canadian-dollar resistance around the C$0.9766 area will likely cap any major moves stronger in the near term.
Elsewhere, global stocks and the euro dipped as investors cashed in some of last week's sharp gains ahead of a German ruling on the euro zone's new bailout fund, Dutch elections and the conclusion of the Fed's two-day policy meeting on Thursday. <MKTS/GLOB> Continued...