The Canadian dollar weakened against all G10 currencies on Friday after domestic data showed an unexpected decline in employment, prompting investors to scale back bets on further interest rate hikes by the Bank of Canada this year.

The Canadian dollar, known as the “loonie,” fell 0.2% to 1.3690 against the US dollar, or 72.99 US cents, after touching its weakest level since April 29 at 1.3710 during the session. It was the only G10 currency to post losses against the US dollar.

On a weekly basis, the Canadian dollar declined 0.7% after four consecutive weeks of gains.

Data showed that the Canadian economy lost 17,700 jobs during April, while the unemployment rate rose to a six-month high of 6.9%, signaling continued weakness in the labor market amid pressure from trade uncertainty. Analysts had expected the economy to add 15,000 jobs.

Karl Schamotta, chief market strategist at Corpay, said in a note: “The Canadian dollar is weakening as traders reduce expectations for monetary policy tightening that had previously been priced into interest rate curves, while yield differentials continue to favor the US dollar.”

He added: “We believe signs of stabilization will emerge over the coming months as trade uncertainty eases and downside momentum in the housing market begins to slow, but today’s data points to a long and difficult road ahead for the Canadian economy.”

Investors reduced expectations for Bank of Canada monetary tightening to 38 basis points by December, down from 44 basis points before the data release.

The central bank had indicated last week that it might be forced to implement consecutive interest rate increases if elevated oil prices continue pushing inflation higher.

Meanwhile, US employment data showed continued strength in the labor market, reinforcing expectations that the Federal Reserve will keep interest rates unchanged for some time.

Oil prices rose 0.9% to $95.64 per barrel after renewed clashes near the Strait of Hormuz raised fresh questions about the ceasefire agreement between the United States and Iran. Oil is one of Canada’s key exports.

Canadian government bond yields also declined across the yield curve, with the 10-year bond yield falling 4.1 basis points to 3.483%.

Analysts and market observers told CNBC that the powerful rally that pushed gold and silver to record highs during 2025 could resume if a peace agreement is reached between the United States and Iran, as prices climbed again on Thursday.

Spot gold rose 1.2% to $4,750 per ounce in early trading amid hopes that the United States and Iran are close to reaching an agreement that would end the 69-day war.

US gold futures also gained 1.2% to settle near $4,750 per ounce.

Meanwhile, spot silver rose 3% to $79.62 per ounce, while July silver futures jumped 3.9%.

Gold and silver had recorded historic gains during 2025, with gold surging about 66% and silver rising 135% over the year. However, trading became more volatile during 2026, as silver futures suffered their biggest daily loss since the 1980s at the end of January, while gold lost more than 10% from its January peak.

Since the outbreak of the war between the United States and Iran on February 28, gold’s reputation as a safe haven during periods of turmoil has come under pressure after some of the factors supporting its rally were called into question.

Ross Norman, CEO of precious metals platform Metals Daily, said that the possibility of higher interest rates, the strength of the US dollar due to rising oil prices, and profit-taking by traders all contributed to gold’s recent decline, especially as the yellow metal entered the war in a “heavily overbought” condition.

He added that this gave traders an opportunity to lock in profits and pushed the market into a consolidation phase after investors began selling their best-performing assets.

Francis Tan, chief Asia strategist at Indosuez Wealth Management, described this characteristic as “extremely useful” during the market turmoil in March.

He explained in an interview with CNBC that investors who held part of their portfolios in gold during the stock market decline achieved strong returns and were able to sell part of their holdings to offset equity losses.

He added: “Gold has already done its job as a safe haven.”

During the war period, gold moved inversely with both oil prices and the US dollar.

Norman said: “The dollar and gold rose together, with the dollar benefiting from safe-haven capital flows amid disruptions to energy supplies, while gold benefited from safe-haven inflows. But a peace agreement means these supporting factors begin to fade, and that is what we are seeing now. It is as if the brakes on gold and silver have been removed.”

Where are prices heading?

Philippe Gijsels, chief strategy officer at BNP Paribas Fortis, has maintained a bullish view on gold and silver for a long time, stressing that current volatility has not changed his conviction that further gains remain possible.

He said the recent pullback in gold and silver prices represents only a “consolidation phase.”

He added: “This time, precious metals have shown a strong correlation with equities. Both came under pressure due to fears that inflation could lead to higher interest rates.”

He continued: “In our world, interest rates represent gravity. When rates rise, gravity strengthens and all assets decline, including precious metals.”

As the Iranian war continued, along with warnings about price shocks and slowing economic growth, markets quickly priced in expectations that monetary easing cycles in several major economies would pause, with some central banks potentially resorting to interest rate hikes to counter the impact of rising energy prices.

However, optimism returned to markets on Wednesday after reports indicated that the United States and Iran were close to a peace agreement, which was reflected in a recovery in precious metals alongside rising equities.

Gijsels said: “We expect the long-term bull market in gold and silver to resume its course, with prices reaching new record highs in the not-too-distant future, possibly this year.”

He added: “All the factors that pushed gold and silver to these levels remain strongly in place.”

He explained that central banks and governments will continue diversifying reserves away from US government bonds toward gold, adding: “We are living in a structurally high-inflation environment, and therefore real assets must be held, with precious metals forming a core part of them.”

He noted that as the “fog of war” clears, investors will return to the gold and silver markets once again.

He described the recent decline in prices as “not the end, but merely a temporary pause in what may become the strongest and longest bull market in the history of gold and silver.”

Paul Williams, CEO of gold and silver specialist Solomon Global, also said that forecasting prices remains difficult as long as the war continues, particularly for silver, which is more volatile.

However, he pointed out that the market fundamentals supporting silver’s rise in 2025 remain intact, explaining that physical silver supplies remain limited while strong demand from green technology sectors continues.

He added that the war between the United States and Iran has also reinforced the strategic importance of solar energy, alongside continued growth in demand linked to artificial intelligence technologies, increasing pressure on a market already suffering from a supply-demand imbalance.

Silver is used in a wide range of industrial applications, from computers and mobile phones to solar panels and automobiles.

Despite expecting continued short-term volatility until a lasting agreement is reached between Washington and Tehran, Williams stressed that prices will remain supported over the long term.

He added: “I expect further gains and favorable conditions as more investors move toward physical assets outside the traditional financial system.”

He noted that if a peace agreement is signed, silver is likely to benefit from improving economic sentiment, rising industrial demand, and increased investor risk appetite, while gold would initially lead any safe-haven rally if negotiations fail, before silver quickly follows due to limited physical supply.

The S&P 500 and Nasdaq indexes reached new record highs during Friday trading, supported by gains in Nvidia and Apple shares, alongside stronger-than-expected US jobs data that reinforced investor confidence in the strength of the American labor market.

Nvidia shares rose more than 2%, alongside Apple shares, while the semiconductor index (.SOX) recovered Thursday’s losses to reach a new record high amid expectations of continued strong demand for artificial intelligence-related infrastructure.

Data showed that the US economy added more jobs than expected during April, while the unemployment rate remained stable at 4.3%, signaling continued resilience in the labor market and strengthening investor bets that the Federal Reserve will keep interest rates unchanged for a longer period.

Sam Stovall, chief investment strategist at CFRA Research, said the data “confirms that the labor market remains strong, which gives consumers confidence to continue spending aggressively.”

Traders still expect the Federal Reserve to maintain interest rates within the 3.50% to 3.75% range through the end of the year.

By 09:41 a.m. Eastern Time, the Dow Jones Industrial Average (.DJI) rose by 106.64 points, or 0.22%, to 49,703.61 points, while the S&P 500 gained 33.47 points, or 0.46%, to 7,371.21 points, and the Nasdaq Composite jumped 195.50 points, or 0.76%, to 26,001.69 points.

Both the S&P 500 and Nasdaq are heading toward a sixth consecutive week of gains, marking the longest weekly winning streak since October 2024, while the Dow Jones is on track for a second consecutive weekly gain.

This positive atmosphere helped investors overlook the latest exchanges of attacks between US and Iranian forces in the Gulf region.

Oil prices had earlier touched the $100-per-barrel level before easing slightly as hopes for a quick resolution to the Middle East conflict and the reopening of the Strait of Hormuz faded. The strait remains a vital corridor for oil and liquefied natural gas shipments.

Iran’s semi-official Tasnim news agency quoted a Foreign Ministry spokesperson as saying Tehran is still reviewing its response to the US proposal.

Despite concerns that rising oil prices could fuel inflation, the S&P 500 and Nasdaq continued recording new record highs, supported by a strong earnings season, signs of resilience in the US economy, and optimism surrounding technology and artificial intelligence companies.

According to data compiled by LSEG, 83% of the 440 companies within the S&P 500 that have reported quarterly results so far exceeded earnings expectations, compared with a long-term historical average of around 67%.

However, some companies posted disappointing results. Cloudflare shares fell 18.6% after the cloud computing services company announced plans to reduce about 20% of its workforce and projected second-quarter revenue slightly below Wall Street estimates.

The Trade Desk shares also declined 5.3% after the advertising technology company forecast quarterly revenue below market expectations.

CoreWeave shares dropped 9% after the cloud infrastructure company raised the lower end of its annual capital expenditure guidance, citing rising component costs.

Expedia shares fell 8.7% after the online travel platform indicated that the Middle East conflict is negatively affecting demand.

In market breadth, advancing stocks outnumbered declining stocks by a ratio of 1.41 to 1 on the New York Stock Exchange and by 1.08 to 1 on Nasdaq.

The S&P 500 recorded 13 new 52-week highs against six new lows, while the Nasdaq Composite recorded 59 new highs and 43 new lows.

Commerzbank analysts said copper outperformed the rest of the base metals this week, supported by improving economic sentiment linked to the Strait of Hormuz, alongside ongoing problems in the global mining sector.

The strategists explained that copper prices on the London Metal Exchange rose by around 5% this week, significantly outperforming other industrial metals.

They noted that part of this rise was driven by improving expectations regarding a quick reopening of the Strait of Hormuz, which reduces the risks of a sharp slowdown in the global economy and therefore weaker demand for copper.

The report added that reopening the strait could also help ease the sulfuric acid shortage crisis, which may positively affect copper production.

Regarding supply, data showed that Chile’s copper ore production rose to 434,300 tons during March after recording its lowest level in nine years at 378,300 tons in February.

However, compared with the same period last year, the annual production decline accelerated to 9%, versus a 4.9% decline recorded in February.

The bank’s analysts also pointed to continuing production risks in Indonesia, where the Grasberg mine is operating at only 40% to 50% of capacity.

The report stressed that these developments once again demonstrate that the weakest link in global copper production remains mining operations and copper ore output.

Although the International Copper Study Group expects mine production to rise by 1.6% this year, Commerzbank analysts warned against overlooking the risks surrounding those forecasts, noting that they could directly affect global copper production and prices.