TORONTO - A weak U.S. dollar and higher commodity prices pushed the Canadian dollar higher Friday despite an employment report for March that missed expectations.
The loonie was up 0.22 of a cent to 104.55 cents US after earlier going to a fresh three and a half year high of 104.98 cents US.
Statistics Canada reported that the economy shed 1,500 jobs for the first time since last September. Economists had expected an overall gain of about 30,000 jobs during March.
However, the unemployment rate did manage to slip to 7.7 per cent from 7.8 the previous month and there was a surge of 90-thousand full time jobs.
"The employment report made next to no impact on the Canadian dollar," said BMO Capital Markets deputy chief economist Doug Porter.
"The big driver at the moment is the U.S. dollar itself retreating against most currencies and we are seeing real strength in almost every major commodity you can shake a stick at. Gold prices are at a record high, silver is above US$40 an ounce and oil is up another one to two dollars."
Crude prices surged as fighting in Libya damaged oil fields in the OPEC nation with the May contract on the New York Mercantile Exchange up $1.37 to US$111.67 a barrel, its highest level in about two-and-a-half years.
A weak U.S. dollar also helped send the May gold contract on the Nymex up $12.40 to US$1,471.70 an ounce.
The May copper contract in New York rose seven cents to US$4.48 a pound.
Analysts say the bout of weakness in the U.S. dollar is likely not going away anytime soon.
"The downward pressures on the (greenback) have accelerated recently on the back of loose U.S. monetary policy, a weak fiscal position (with no credible plan in place), U.S. dollar bearish market sentiment, rising comfort with periphery Europe and rising non-U.S. global interest rates," said a commentary from Scotia Capital.
"We do not think these issues are temporary and expect ongoing weakness in the U.S. dollar this year."
