The Canadian dollar strengthened
to a two-month high against its U.S. counterpart on Friday, as
equity markets held on to this week's sharp gains and domestic
data showed the economy added further jobs in October.
The loonie was trading 0.1% higher at 1.3030 to the
greenback, or 76.75 U.S. cents, having notched its strongest
intraday level since Sept. 1 at 1.3019. The loonie was up 2.2%
for the week, its biggest advance since June.
Wall Street steadied as Democratic challenger Joe Biden
edged closer to victory in the U.S. presidential election.
Investors have been betting that a potentially split Congress
would reduce the risk of tighter regulations on U.S. companies
and that the Federal Reserve will keep its loose monetary policy
"The Canadian dollar is still very much positively
correlated with risk sentiment," said Erik Bregar, head of FX
strategy at Exchange Bank of Canada. "If stocks keep going
higher ... it is going to make the Canadian dollar go higher."
The U.S. dollar fell against a basket of major
currencies, while U.S. crude oil futures settled 4.3%
lower at $37.14 a barrel. New lockdowns in Europe to halt
surging COVID-19 infections threatened to reduce demand for oil,
one of Canada's major exports.
Statistics Canada reported 83,600 new jobs in October. That
was fewer than expected as coronavirus-related shutdowns started
to bite, but analysts said the gain reflected welcome signs of
resilience in the economy.
Separate data showed that Canadian economic activity
expanded at a faster-than-expected pace in October. The Ivey
Purchasing Managers Index rose to 54.5 in October from 54.3 in
Investors also digested U.S. jobs data, which showed that
employers hired the fewest workers in five months.
Canadian government bond yields were higher across a steeper
curve in sympathy with U.S. Treasuries. The 10-year
rose 3.5 basis points to 0.649%.
(Reporting by Fergal Smith; Editing by Alex Richardson and