TORONTO – The Canadian dollar chalked up a solid gain as employment data for January came in ahead of expectations.

The loonie moved ahead 0.42 of a cent to 90.75 cents US as Statistics Canada said that 29,400 jobs were created after the economy shed 44,000 jobs during December.

Economists had expected that the economy would create about 20,000 jobs last month.

Canada’s national unemployment rate slid to 7.0 per cent for the first month of the year, compared with 7.2 per cent in December.

But U.S. numbers were a big disappointment as the Labor Department reported that 113,00 jobs were created against the approximately 180,000 that had been expected.

Still, more people began looking for work in January, and some of the jobless were hired, reducing the unemployment rate to 6.6 per cent from 6.7 per cent. That’s the lowest since October 2008.

The performance followed a meagre gain of 74,000 during December that was largely blamed on the weather.

The January employment report has been seen as key as markets have experienced much volatility in recent weeks on worries of a possible slowing in manufacturing in China and the U.S.

Emerging economies have also been a worry because markets in those countries have been hit as the Federal Reserve began to cutback on its key stimulus measure of massive bond buying. That move kept long long-term rates and encouraged a flood of cheap money into emerging markets.

The Fed has moved twice in the past two months to cut back on those asset purchases, down a total of $20 billion to $65 billion a month, and the markets now have to deal with an outflow of funds.

On the commodity markets, March crude on the New York Mercantile Exchange was 40 cents lower to US$97.44 a barrel.

March copper moved ahead two cents to US$3.24 a pound while April bullion gained $12.30 to US$1,269.50 an ounce.