Perhaps, US employment data was the most important event today, but it was Canadian employment that shocked the Forex market. And it surprised in a positive way, allowing the Canadian dollar to surge.
Analysts have predicted an increase by 16,100 in May, following the March’s rise by 12,500. But in fact Canadian employment grew by mind-boggling 95,000. It was the biggest job gain since August 2002. Additionally, the unemployment rate unexpectedly ticked down by 0.1 percentage point to 7.1 percent.
The huge improvement of employment outweighed other today’s events for the Canadian currency, leading to a rally (though it was not as big as one could expect considering the size of the employment increase). The currency was also supported by the outlook for higher interest rates.
USD/CAD 1.0261 to 1.0194 as of 19:52 GMT today. EUR/CAD edged down from 1.3593 to 1.3474 and CAD/JPY rose from 94.44 to 95.63 after falling to 92.92 (the lowest rate since April 4).
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