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Canadian dollar lower ahead of August jobs data from Canada, U.S.

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(Globalpost/GlobalPost)

TORONTO - The Canadian dollar closed slightly lower a day ahead of the release of key employment data in Canada and the U.S.

The loonie lost 0.13 of a cent to 95.18 cents US.

The key economic event of the week occurs Friday when the U.S. Labor Department releases its employment report for August. Economists expect the economy cranked out about 180,000 jobs last month but lower numbers of people applying for jobless insurance have encouraged some traders to think the number could be much higher.

On Thursday, payroll firm ADP reported that the American private sector created 176,000 jobs last month.

Also, the number of Americans seeking unemployment benefits dropped 9,000 last week to a seasonally adjusted 323,000, near the lowest level since June 2008.

Other data showed rising expansion in the U.S. service sector as sales and orders grew and employers ramped up hiring.

The Institute for Supply Management said Thursday that its service-sector index rose to 58.6 in August from 56 in July. It’s the highest point since December 2005.

A measure the index measuring hiring rose to 57, the most in six months.

Canadian jobs data also comes out Friday and it is expected Statistics Canada will announce that the economy created about 30,000 jobs in August.

Oil prices rose after new U.S. indicators underlined a modest recovery in the world’s biggest economy.

October crude on the New York Mercantile Exchange was ahead $1.14 to US$108.37 a barrel.

A jump in U.S. auto sales helped brighten the outlook for oil consumption. General Motors and other U.S. carmakers posted strong sales in August, giving the auto industry its best month in six years.

December copper was unchanged at US$3.24 a pound while December gold bullion fell $17 to US$1,373 an ounce.

Traders also monitored the Syrian crisis and the meeting of G20 countries in St. Petersburg, Russia.

Markets have been preoccupied this week with the prospect of the U.S. leading a military strike against the regime of Syrian President Bashar Assad, which it accuses of using deadly sarin gas against civilians. President Barack Obama is seeking U.S. congressional approval for such a strike and a vote could come as soon as next week.

Overseas, the Bank of England has kept its benchmark interest rate at a record-low 0.5 per cent. The decision had been widely expected as new governor Mark Carney has said the bank would refrain from raising rates until unemployment falls from the current 7.8 per cent to seven per cent.

The European Central Bank also left its benchmark interest rate unchanged at a record low of 0.5 per cent. The bank’s governing council decided at its monthly meeting Thursday that the slowly recovering euro area economy didn’t need a further stimulus.

http://www.globalpost.com/dispatch/news/the-canadian-press/130905/canadian-dollar-rises-commodities-rise-traders-look-g20-jobs