Loonie falls after weak data show precious little growth in Canadas job

TORONTO — The Canadian dollar lost some momentum Friday, amid lower commodity prices and disappointing Canadian jobs figures.The loonie faded 0.58 of a cent to 93.34 cents US.Statistics Canada reported that the economy had an unexpected loss of 9,400 jobs in June, with the unemployment rate rising one-tenth of a point to 7.1% — the highest since last December. Full-time employment rose by 33,500, partly making up for the loss of 43,000 part-time jobs.Economists had expected another big month of job creation following May’s 25,800 gain, but June resumed what has become a year-long trend of weak demand for workers. They had forecasted the agency would report that about 24,000 jobs were created.The Canadian job market remains mired deep in a mid-cycle funk“The Canadian job market remains mired deep in a mid-cycle funk, with precious little employment growth over the past year,” said Doug Porter, chief economist with BMO Capital Markets.These latest jobs figures will no doubt be front and centre of the Bank of Canada’s next interest rate announcement and release of its latest monetary policy report, due next Wednesday.Porter said it’s likely that the central bank will use it as a reason to continue to keep at record-low levels.“While there is much sound and fury surrounding monthly Canadian job tallies, often signifying very little, the underlying trend is unquestionably squishy soft,”he wrote. “Simply, this gives the Bank of Canada all the justification it needs to still sound quite dovish in next week’s interest rate decision and quarterly monetary policy report, even with the recent uptick in prices. Their focus will likely shift from ’too-low inflation” to “too-low growth.”’The Canadian dollar has been hovering around the 94-cent US range as of late, which has raised fresh concerns how the higher currency is affecting the country’s exports and manufacturing sectors. Bank of Canada governor Stephen Poloz has been depending on a weakened Canadian dollar to help drive exports and aid in Canada’s economic recovery.The currency will also be looking for direction from the release of the latest inflation figures due next Friday.It also continues to look for hints that the fundamentals, including oil prices, are supporting its price. Oil rose for the first time in two weeks on Thursday, but pulled back from gains with the August crude contract on the New York Mercantile Exchange dipping $1.47 cents to US$101.46 a barrel.Oil prices shot up in the last month to a 10-month high over concerns that strife in Iraq might disrupt supplies. However, they have since been easing back as al-Qaida-inspired militants’ gains in Iraq did not affect oil exporters.On Friday, Iraq’s Oil Ministry said Kurdish fighters have taken over two oil fields outside the disputed northern city of Kirkuk on Friday.Meanwhile, the prospect of a sudden return of Libyan oil to the global market has also lessened global supply worries. Libyan exports have been all but cut off over the last several months because of labour and political strife that has shut ports and disrupted production. Agreements with local militias are now expected to open two ports, and a major field restarted production Tuesday.In other commodities, gold prices also dropped, with August gold bullion falling $2 to US$1,337.20 an ounce. September copper fell a penny to US$3.24 a pound. read more