Investing.com - The U.S. dollar rose to its highest level in six months against the Canadian dollar on Friday boosted by a stronger-than-forecast U.S. jobs report and unexpectedly weak Canadian trade data.
USD/CAD hit highs of 1.1269, the most since March 23 and was last up 0.82% to 1.1247. For the week, the pair added 0.75%.
The Labor Department reported Friday that the U.S. economy added 248,000 jobs in September, well ahead of forecasts for jobs growth of 215,000. The unemployment rate ticked down to 5.9%, the lowest level since July 2008.
The upbeat jobs report was tempered by slow growth in wages. Average hourly earnings rose by 2.0% year-over-year, slowing slightly from August.
The robust employment data added to the view that the strengthening economic recovery may prompt the Federal Reserve to raise interest rates sooner. The central bank is on track to end its asset purchase program later this month.
The US Dollar Index, which tracks the performance of the greenback against a basket of six major currencies, was up 1.23% to 86.79 in late trade, a high last seen in June 2010, capping its twelfth consecutive weekly gain. The twelve-week rally is the longest since the index was created in 1971.
The Canadian dollar weakened after official data showed that the country unexpectedly posted a trade deficit in August, as imports rose by the most in nearly two years, while exports slowed.
Statistics Canada said imports rose 3.9% in August, while exports decreased 2.5%. As a result, Canada's trade balance went from a surplus of C$2.2 billion in July to a deficit of C$610 million in August.
The weak data fuelled concerns over the outlook for economic growth in the third quarter.
In the coming week, investors will be looking ahead to Wednesday’s Federal Reserve meeting minutes for further indications on the future possible direction of U.S. monetary policy. Canada is to release its September jobs report on Friday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, October 6
Canada is to publish its Ivey PMI.
Tuesday, October 7
Canada is to produce data on building permits.
Wednesday, October 8
Canada is to release data on housing starts.
In the U.S., the Federal Reserve is to publish the minutes of its latest policy setting meeting.
Thursday, October 9
Canada is to report on new house price inflation.
The U.S. is to publish its weekly government report on initial jobless claims.
Friday, October 10
Canada is to publish a report on the change in the number of people unemployed and the unemployment rate.
The U.S. is to round up the week with data on import prices.