TORONTO (Reuters) - The Canadian dollar eased against the U.S. dollar in early trading on Friday following three straight days of gains, but moves were limited ahead of jobs reports from both Canada and the United States.
Economists expect the United States to have added 93,000 jobs and Canada to have added 10,000 jobs. Both releases are due at 8:30 a.m.
“Unless we’re really far off expectations ... the U.S. is going to overshadow Canada,” said David Bradley, director of foreign exchange trading at Scotiabank.
“If the U.S. comes in quite a bit stronger, it’s probably going to be a risk-on environment, so you’re going to see the U.S. dollar sell off, equities rally, and you should see commodity currencies do better.”
Until then, the currency was seen taking cues from global equities, which also edged lower on uncertainty over U.S. budget plans and the darkening outlook for the European economy. .N <MKTS/GLOB>
Germany’s central bank said it expected Europe’s largest economy to grow just 0.4 percent in 2013, and pointed to risks of a recession as the euro zone debt crisis takes its toll.
At 7:50 a.m., the Canadian dollar stood at C$0.9932 versus the greenback, or $1.0068, compared with Thursday’s North American session close at C$0.9911, or $1.0090 U.S. cents. The currency was trading in a tight range between C$0.9910-C$0.9934.
Canada’s dollar hit a one-month high in the previous session, building on gains from earlier in the week after the Bank of Canada kept its bias towards future rate hikes.
Bradley said U.S. dollar support was seen around Thursday’s low of C$0.9892 and resistance near C$0.9955-C$0.9965.
“There are plenty of corporate offers around on the top side now, sovereign type names as well looking to sell (U.S.) dollar/Canada towards C$0.9950. We’d have to get a really negative number for dollar/Canada to trade through that level,” he said.
Canadian bond prices crept up across the curve, with the two-year bond rising 2 Canadian cents to yield 1.033 percent, and the benchmark 10-year bond climbing 13 Canadian cents to yield 1.679 percent.
Reporting by Claire Sibonney; Editing by Chizu Nomiyama