USD/CAD erased earlier losses

After falling to session lows as a result of the downbeat US non-farm payrolls report earlier on Friday, the US dollar managed to erase accumulated losses against its Canadian counterpart.

USD/CAD bounced off its lowest point during the session at 1.0336, recorded at 12:43 GMT, to trade at 1.0365 at 14:23 GMT, up by 0.15% for the day.

Canadian dollar recovered from a two-week low against the greenback after the Bureau of Labor Statistics in the United States said that employers added a lesser number of jobs than projected in the month of July. Non-Farm Payrolls indicator increased by 162 000 in July, while preliminary estimates pointed an increase by 184 000 jobs. June’s result was revised down to 188 000 from 195 000 previously.

“This doesn’t add anything significantly positive to the idea they’re going to be tapering any time soon,” said Greg T. Moore, a currency strategist at Toronto-Dominion Bank, cited by Bloomberg. “Obviously there’s a pretty sharp reaction negative for the U.S. dollar and stronger for the Canadian dollar.”

On the other hand, a separate report showed that unemployment rate in the United States decreased by 0.2% to 7.4% in July, reaching its lowest level since December 2008.

At the same time, factory orders in the United States rose at a slower rate in June compared to May, by 1.5% to a total value of 496.7 billion USD, as in May compared to April orders recorded a 3.0% increase, a revision up from 2.1% previously. Factory orders increased in four out of the past five months, as business and consumer expenditures as well as the improving labour market in the United States gave support to economy during the recent period. Business investments showed improvement, while increased aircraft orders neutralized the weaker performance in the remaining sectors. Orders in civil aviation contributed the most to the overall results, rising by 32% in June. Excluding orders in transportation, factory orders decreased by 0.4% during the same period.

Elsewhere, the loonie, as Canadian dollar is also known, tumbled against the euro, as EUR/CAD cross soared 0.83%, trading at 1.3782 at 14:47 GMT.