The Canadian dollar backed off the day’s lows against its U.S. counterpart on Monday as prices for oil, a major Canadian export fluctuated in choppy trade.
The price of oil, one of Canada’s main exports, gave up early gains on Monday amid persistent concerns that rising U.S. oil output is threatening to derail efforts by other major producers to restrict supply in a bid to rebalance the global market.
The Organization of the Petroleum Exporting Countries and other exporters, including Russia, enacted production cuts in the first half of 2017.
Oil prices found some support after Russia said it was discussing prolonging cuts with other producers beyond the end of this year. Saudi Arabia’s Energy Minister Khalid Al-Falih also talked of the possibility of prolonging curbs beyond 2017.
The loonie fell to 14-month lows against the greenback on Friday as oil prices plunged, before rebounding when oil prices bounced back.
The loonie also came under additional pressure after Canadian jobs data showed that the economy added fewer jobs than expected in April.
Statistics Canada reported Friday that the economy added 3,200 jobs last month, falling short of economists’ forecasts for a gain of 10,000. The unemployment rate unexpectedly fell to 6.5% from 6.7%, the lowest since October 2008.
Meanwhile, Friday’s U.S. jobs report showed that the economy added 211,000 jobs last month, beating expectations for a gain of 185,000 and the unemployment rate ticked down to 4.4%, a near a 10-year low.
The jobs data did little to alter the view that the Federal Reserve will raise interest rates in June.