Loonie heads south on soft employment data

The Canadian dollar faltered versus its American rival after weak employment data, with Canada's unemployment coming higher than expected, which put more pressure on the loonie especially as oil struggles. 

USD/CAD traded at 1.3867, compared to the opening level of 1.3758, with an intraday high at 1.38675, and a low at 1.3709. The pair hit a two-month low yesterday at 1.3639. 

Earlier data showed Canada's employment change dropping 5.7 thousand in January, compared to expectations of a 5.2K rise, and December's strong gain of 22.8K. 

Subsequently, the unemployment rate rose to 7.2% from the previous reading's 7.1%. Analysts expected a flat result. 

Inversely, the greenback rose strongly against its rivals after the unemployment rate fell to an eight-month low, which brightened the economy's outlook and its ability to face off the current slowdown in the global economy. 

The U.S. dollar's strength halted oil's gains, which affected the Canadian dollar negatively as they go hand in hand because a large chunk of the Canadian economy depends on oil exports.