3 Min Read
* C$ rises to session high C$1.0922 per US$
* Canada adds 27,100 jobs in August
* Bond prices lower across curve (Adds details and comments)
By Frank Pingue
TORONTO, Sept 4 (Reuters) - Canada's currency raced higher versus the greenback on Friday after data showed the domestic economy unexpectedly added jobs in August, but the gains will be tested when a U.S. jobs report arrives shortly.
The data boosted the Canadian dollar as high as C$1.0922 to the U.S. dollar, or 91.56 U.S. cents, up from a pre-data level around C$1.0969 to the U.S. dollar, or 91.17 U.S. cents.
"From a market perspective we've already seen the impact on the Canadian dollar significantly stronger," said Matthew Strauss, senior currency strategist at RBC Capital Markets.
"We could see some follow though for the next while until the market starts focusing on the (U.S. jobs data), but as it stand these numbers are pretty good."
The data showed Canada's economy unexpectedly added 27,100 jobs in August but the unemployment rate rose to an 11-1/2 year high of 8.7 percent from 8.6 percent in July. [ID:nN04153956]
By 7:25 a.m. (1125 GMT), the Canadian dollar had retreated a touch to C$1.0941 to the U.S. dollar, or 91.40 U.S. cents, which was still up from C$1.1033 to the U.S. dollar, or 90.64 U.S. cents, at Thursday's close.
The early gains in the Canadian dollar could be put to the test after the U.S. nonfarm payrolls data due at 8:30 a.m., which is expected to show employers in August likely cut jobs by the least amount in a year, a sign of healing in the labor market. [ID:nN01485399]
If the U.S. report comes in worse than expected, there is a chance traders could unload the Canadian dollar and flock to the U.S. dollar given its status as a safe haven play.
Canadian bond prices extended losses following the data, which lessened the appeal of more secure assets like government debt. But the moves were limited ahead of the U.S. jobs report. (Editing by Jeffrey Hodgson)