WRAPUP 2-Canada hit with surprise jobs loss, weak housing starts

Fri Feb 8, 2013 1:10pm EST
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* Economy sheds 21,900 jobs, jobless rate drops to 7.0 pct

* Housing starts plunge in January to 160,577 units

* December trade deficit narrows

* Bank of Canada may further soften rate-hike stance

By David Ljunggren and Louise Egan

OTTAWA, Feb 8 (Reuters) - Canada's economy unexpectedly shed jobs in January, while housing starts plunged, suggesting global uncertainty, weak prices for Canadian oil, and a government clampdown on the property market will drag on growth in early 2013.

A slew of weak data released on Friday quickly knocked the Canadian dollar below parity with the U.S. dollar. Adding to the gloom were figures showing Canada posted a record trade deficit in 2012.

Statistics Canada said 21,900 people lost their jobs in January, surprising markets, which had expected a gain of 5,000 jobs after two very strong months of employment growth.

The jobs data could push the Bank of Canada off its slightly hawkish tilt, said Mark Chandler, strategist at RBC Capital.   Continued...