ENM: Canadian dollar competing against the pound sterling for the 'wooden spoon
The Canadian dollar (Currency:CAD) is looking pretty poor on the global markets today - indeed, only the GBP could be cited as being worse-off.
The pound / Canadian dollar exchange rate is 0.17 pct in the red at 1.5814.
The euro / Canadian dollar rate is 0.67 pct higher on a daily basis at 1.3487.
The US dollar / Canadian dollar exchange rate is 0.55 pct higher at 1.0076.
Please be aware that this is a spot market rate - your bank will levy their own spread to the above. We would suggest inquiring with a retail currency provider as they guarantee to undercut your bank's offer thereby delivering you more currency. Please see more here.
A softer tone to the Canadian dollar
"For the CAD, it feels like the trend of disappointing (relative to expectations, at least) domestic data releases over the past few weeks are catching up with the currency," says Shaun Osborne at TD Securities.
The weak employment data Friday has helped extend USD gains back towards the highs seen late last month after the BoC turned a little less hawkish.
"With the CAD now driven more by the “usual suspects” of commodity prices and interest rate differentials than risk appetite, the slide in Canada-US 2-year spreads (about 10bps narrower over the past 3-4 weeks) support the softer CAD tone," says Osborne.
Canadian dollar no stranger to the 'wooden spoon'
"Although none of the commodity-related currencies had a particularly good day on Friday it was the Canadian dollar that bagged the wooden spoon, losing three quarters of a cent to the US dollar and two cents to the pound. It seems that the Loonie was singled out for punishment because Canada was the only major country to publish economic data and they were a bit rubbish," says Mark Deans at Moneycorp.
Housing starts fell sharply to their slowest pace in three and a half years and the employment figures were a disappointment, with a loss of 22k jobs.
As with Thursday's Australian employment numbers, a fall in the rate of unemployment masked a decline in participation by disheartened job seekers.
Lloyds Bank reflects on the poorer than expected employment data that drove CAD weakness on Friday:
"CAD struggled on Friday weighed by the weaker Housing and employment data. The unemployment rate fell to 7.0% but employment fell by 21.9k, much weaker than expected. This comes after five consecutive months of resilient employment growth.
"Employment data has tended to lag domestic growth, and the weaker number reflects the softer growth seen in Q3. CAD has underperformed of late following a dovish tone from the BoC’s latest rate meeting.
"But with long positioning now significantly reduced we think further CAD underperformance may be limited."
