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The Canadian dollar is finding renewed strength after a period of consolidation. The currency is up 1.2% Friday and on pace for its best day since early January. Gains are being fueled by a surge in Canadian government yields after another solid jobs report, higher oil prices and improving risk sentiment and a surge in Canadian government yields. The addition of 41,400 Canadian jobs in April and a near record-low unemployment rate has traders quickly scaling back expectations of a potential Bank of Canada rate cut toward the end of the year. “Canadian job growth keeps defying expectations with serial beats relative to consensus expectations. A fly in the ointment is that wage growth has evaporated, but that might be temporary, writes Derek Holt of Scotiabank Economics. Since reaching its weakest point against the greenback this year on March 10, the loonie has climbed about 4%. Bets of additional rate hikes may emerge if inflation data next week shows price pressures remain stubbornly high. On Thursday, Bank of Canada Governor Tiff Macklem said he was worried about upside risks to inflation. The central bank paused its rate hike cycle in January, leaving rates at 4.5% while the Fed continued […]
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