CANADA FX DEBT-C$ gains against greenback after mixed jobs data

Fri May 8, 2015 9:44am EDT
 
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* Canadian dollar at C$1.2083 or 82.76 U.S. cents
    * Bond prices higher across the maturity curve

    By Solarina Ho
    TORONTO, May 8 (Reuters) - The Canadian dollar strengthened
against the greenback on Friday, after gyrating a cent to
session highs and lows as investors digested April employment
data from the United States and Canada.
     The Canadian economy lost 19,700 jobs, far greater than the
5,000 positions economists had expected to disappear, as losses
in part-time work offset gains in full-time positions. The
unemployment rate stood at 6.8 percent. 
    South of the border, U.S. job growth rebounded 223,000 and
the unemployment rate dropped to a near seven-year low of 5.4
percent, signs that the economy was picking up after a
lackluster first quarter. 
    Traders pared bets the Federal Reserve will move to raise
U.S. benchmark interest rates even by the end of the year,
however, following the report. 
    "The market seems to be reading the U.S. numbers as just a
touch weaker than expected," said Doug Porter, chief economist
at BMO Capital Markets.
    "So it's actually given a tiny lift to the Canadian dollar
even though the Canadian number was negative. I think there was
some concern that the Canadian number could have been even
weaker." 
    At 9:32 a.m. ET (1332 GMT), the Canadian dollar was
trading at C$1.2083 to the greenback, or 82.76 U.S. cents,
stronger than the Bank of Canada's official close of C$1.2120,
or 82.51 U.S. cents.
    Immediately after the data was released, the currency
rallied to a session high of C$1.2046 before retreating to a
session low of C$1.2145. 
    Canadian government bond prices were higher across the
maturity curve, with the two-year price up 3.5
Canadian cents to yield 0.662 percent and the benchmark 10-year
 rising 64 Canadian cents to yield 1.68 percent.
    The Canada-U.S. two-year bond spread was 8.6 basis points,
while the 10-year spread was -43 basis points. 

 (Additional reporting by Susan Taylor; Editing by Nick
Zieminski)