Loonie closes slightly lower before jobs data provides glimpse into economy
TORONTO - The Canadian dollar held relatively steady on Thursday ahead of employment numbers that will provide a glimpse at the state of the U.S. and Canadian economies.
The loonie ended the day 0.03 of a cent lower at 90.59 before the key employment data is released early Friday.
Both countries are expected to show modest increases helped by calmer winter weather in March, but questions remain over whether Canadian jobs market growth is stagnant.
"In our analysis of recent trends, we find that Canadaâ€™s labour market is still on a better footing than the U.S. market," said Mark Chandler, head of Canadian FIC Strategy at RBC Dominion Securities, in a note.
"Its overall performance is not too different from previous cycles and â€” while a modest degree of slack is present â€” it is not considerably different from the overall level of slack for the economy as a whole.
Economists expect that the latest American job creation figures will show that businesses started hiring more workers in March as the bad winter weather subsided. Consensus expectations suggest that around 195,000 new positions were created, which would be a steady improvement from recent months.
In Canada, analysts expect about 25,000 jobs were added last month, which would be an improvement over the decline of 7,000 in February.
On Thursday, the Institute for Supply Management's non-manufacturing index rose helped by growth in the service sector, while data from the U.S. Labor Department indicated that hiring remains stable, close to levels seen before the recession.
Meanwhile, Statistics Canada reported the country had a small trade surplus of $290 million in February, compared to a deficit of $337 million in January. Merchandise exports grew 3.6 per cent, while imports were up 2.1 per cent in February, it said.
In commodities, June bullion dropped $6.20 to US$1,284.60 an ounce, as investors moved away from the precious metal on signs of further growth in the U.S. economy.
The price of oil closed above US$100 a barrel with the May contract for light crude up 67 cents at US$100.29. May copper dipped 1.9 cents at US$3.027 a pound.
The European Central Bank announced it would keep its key policy rate unchanged, saying that despite evidence the economy of the 18-country eurozone is weak and inflation is going down, interest rates will remain at 0.25 per cent.
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