* Canadian dollar slides to 94.43 U.S. cents
* Canada adds 79,000 jobs in November
* Bond prices lower across the curve (Recasts, adds details and quotes)
By Jennifer Kwan
TORONTO, Dec 4 (Reuters) - The Canadian dollar fell against the U.S. currency on Friday, squeezed by weak commodity prices and a surging greenback, which climbed on employment data that showed the U.S. shed far fewer jobs than expected.
Initially, the U.S. numbers helped to boost global equity markets and the Canadian currency climbed as high as C$1.0433 to the U.S. dollar, or 95.85 U.S. cents.
But as the surprisingly strong employment data boosted hopes that a recovery was in the making, it also raised the possibility the U.S. Federal Reserve could move to raise interest rates sooner than expected, said George Davis, chief technical strategist at RBC Capital Markets.
"There are a couple of opposing forces that have been sort of pushing the market today," he said.
"Today's number has some people sort of guessing as to whether or not the Fed is going to be looking to hike rates sooner rather than later," Davis said.
"Because of that, we've seen the (U.S.) dollar basically rally aggressively across the board and that has been the main factor that has taken dollar/Canada off the lows."
U.S. employers cut just 11,000 jobs in November, far fewer than expected, while the U.S. unemployment rate fell to 10 percent. [ID:nN03103070]
An earlier report report showed Canada's economy created far more jobs than expected in November and the unemployment rate fell, suggesting a recovery is in the making.
Statistics Canada reported a net employment gain of 79,000 jobs, beating analysts expectations of a 15,000 gain. The unemployment rate edged lower to 8.5 percent from 8.6 percent in October. Analysts had expected a rise to 8.7 percent. [ID:nN04141170]
Market watchers also said the report's details were strong, with full-time employment rising by 39,000, with some 40,000 jobs added to part-time payrolls. The employment market was strongest in the services sector, with the largest growth in education.
At 3:03 p.m. (2003 GMT), the Canadian dollar was at C$1.0590 to the U.S. dollar, or 94.43 U.S. cents, down from Thursday's finish at C$1.0547 to the U.S. dollar, or 94.81 U.S. cents.
The price of crude, a key Canadian export, weighed on the currency, falling below $76 a barrel, due in part to the stronger U.S. dollar, while gold prices fell below $1,150 an ounce. [O/R] [USD/] [GOL/]
BOND PRICES LOWER
Canadian bond prices were lower across the curve following the jobs data, but the selling began on both sides of the border even before the release of the employment reports, analysts said.
"Better than expected jobs reports might feed ... stronger than expected near-term growth views. But at the same time the take back is that it makes markets nervous that perhaps central bankers are going to take the punch bowl away earlier than expected," said Derek Holt, an economist at Scotia Capital.
The two-year government bond