USD / CAD falls below 1.2800 as CAD capitalizes on upbeat Canadian jobs report

• USD / CAD fell to its lowest level in more than two years below 1.2800.
• The unemployment rate in Canada fell to 8.5% in November.
• The US Dollar Index was flat on the day near 90.70 after the NFP report.

After spending the first half of the day fluctuating in a tight range near 1.2850, the USD / CAD It came under renewed downward pressure during US business hours and fell to its lowest level since October 2018 at 1.2790. At time of writing, the pair is trading a couple of pips above that level, losing 0.5% on the day.

CAD hits highs after US and Canadian employment data

Canada’s optimistic employment report gave the loon a boost on Friday. Monthly data released by Statistics Canada showed that the unemployment rate dropped to 8.5% in November, compared to analysts’ estimate of 8.9%. Furthermore, the net change in employment reached +62,000 and exceeded the market expectation of 20,000 by a wide margin.

On the other hand, the US Dollar Index (DXY) struggled to achieve a convincing recovery after labor market data from the US Bureau of Labor Statistics.The DXY is currently unchanged on the day at 90.68 and remains at on track to close the third consecutive week in negative territory.

Nonfarm payrolls in the U.S. increased by just 245,000 and fell short of experts’ forecast of a 469,000 increase. Despite this disappointing reading, the S&P 500 index rose to a new high on Friday to show that risk flows continue to control financial markets.

Meanwhile, a barrel of West Texas Intermediate (WTI) is up nearly 1% on Friday, allowing commodity-related CAD to continue to outperform rivals.

Technical levels