April employment in Canada fell by 17.7K, missing forecasts and pushing the unemployment rate to 6.9%, pressuring the CAD.
USD/CAD climbed to 1.3694 on Friday after Canadian employment data undershot expectations. The economy shed 17.7K jobs in April, defying forecasts for a 15K gain and reversing March’s 14.1K increase. The unemployment rate rose to 6.9% from 6.7%, while wage growth slowed to 4.8% YoY from 5.1% in March.
The weaker labor market may prompt the Bank of Canada to reconsider its policy stance, particularly if inflation pressures from oil prices persist. The CAD also faced pressure from a decline in crude prices, given Canada’s status as a major oil exporter.
The USD remained under broader pressure after mixed US jobs data reinforced expectations of a cautious Fed approach to rate cuts. USD/CAD is set to snap a four-week losing streak.