The Canadian dollar rose from almost the lowest point in more than three years on bets the currency had fallen too far, too fast after the Federal Reserve announced it would slow its monetary stimulus program.
The Canadian dollar snapped three weeks of losses on jobs gains that tripled the forecast even as U.S. employment growth faltered, accelerating a rally than began as the Bank of Canada reiterated that policy is appropriate.
Canada’s dollar strengthened for the first week in three as risk appetite outweighed concern that Europe’s sovereign-debt crisis is worsening, sending crude oil, the nation’s biggest export, and stocks higher.
Canada’s dollar weakened the most this month versus the greenback and the yen as evidence of a slowing U.S. economic recovery made the currencies of countries reliant on commodity exports less attractive.
The Canadian dollar fell versus most of its 16 major peers for a third week, the longest streak since June, on concern the 16-day U.S. government shutdown added to economic headwinds for the country’s largest trading partner.