Loonie advances, traders look to comments from Bank of Canada’s Poloz, jobs data

TORONTO – The Canadian dollar was higher Thursday as traders looked ahead to comments from the new Bank of Canada governor and the latest employment data.

The commodity-sensitive loonie was up 0.23 of a cent to 96.89 cents US while prices for oil and gold advanced.

Markets will be focused on Stephen Poloz, who took on the top job at the central bank this week, and his two-hour appearance before the House of Commons Standing Committee on Finance.

There will be an opening statement followed by a question and answer session.

“The latter should be the most interesting, as the politicians probe for differences from his predecessor (Mark Carney),” observed a commentary from BMO Capital Markets. Carney is taking over as governor of the Bank of England.

Meanwhile, Statistics Canada was expected to report Friday that the economy created about 20,000 jobs last month while the jobless rate slipped to 7.1 per cent from 7.2 per cent in April.

Traders also looked to the release Friday of the U.S. government’s official employment report for May.

Economists have been forecasting that the American economy cranked out a total of 165,000 jobs last month. But that modest figure was called into doubt after payroll firm ADP reported that the U.S. private sector cranked out 135,000 jobs during May, less than the 165,000 that had been expected.

Also, the latest reading on the health of the U.S. service sector showed rising expansion but the data also showed that hiring slowed further in May to the lowest level since last July.

Traders hope to get a better idea of the job market with the release Thursday of the latest data on applications for jobless benefits, a key gauge of layoff activity.

Commodities were mixed Thursday with July crude on the New York Mercantile Exchange ahead 47 cents to US$94.21 a barrel.

Prices advanced on Wednesday after the Energy Department said U.S. crude oil inventories shrank by 6.3 million barrels last week, much bigger than the one million drop that had been expected.

July copper stepped back five cents to US$3.32 a pound while August bullion gained $5 to US$1,403.50 an ounce.