The Canadian dollar weakened on Friday, following worse-than-forecast employment figures released in the afternoon. The currency suffered its biggest drop in over two weeks in response to the data, which revived speculation that the central bank may be forced to cut interest rates in order to stimulate growth and prop up the jobs market. Last Wednesday’s decision to keep interest rates unchanged pushed up the currency’s value, but Friday’s figures saw much of these gains eradicated.
The Japanese yen lost further ground on Friday. In response to the geopolitical situation in the Ukraine, the yen had a very strong start to last week as traders looked to buy into Japanese safe-haven assets. These gains were pegged back as the week went on, and optimistic employment figures out of the US on Friday injected more confidence into the market. As a result, we saw the demand for risk increase and the yen lose value.
Looking forward to this week, we have Australian business confidence data and employment figures. In New Zealand we have an interest rate decision and central bank press conference, and in Japan we have a monetary policy statement and central bank conference. We also have industrial production figures out of China.
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