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Canada’s dollar dropped for the first time in four days against the greenback as crude oil fell after a report showed U.S. inventories rose to a two-year high and North American stocks declined.
The Canadian dollar weakened a day after Finance Minister Jim Flaherty said the government wants to avoid extreme currency fluctuations.
Crude oil for June delivery fell 4.8% to $98.90 a barrel.
Supplies of crude in the U.S., Canada’s biggest trading partner, jumped 3.78 million barrels to 370.3 million in the week ended May 6, the Energy Department said today in a weekly report. Inventories were forecast to climb by 1.5 million barrels. The increase puts supplies at the highest level since May 8, 2009.
Canadian employers added a net 58,300 jobs in April after a decrease of 1,500 in the previous month, Statistics Canada reported last week. The median forecast of economists was for an increase of 20,000. The jobless rate unexpectedly dropped to 7.6%.
The nation reported a fourth straight trade surplus in March, the longest string since November 2008 and a sign that exporters are recovering from the global recession.
The surplus widened to C$627 million ($658 million), larger than the C$400 million median forecast.
The pound gained versus the dollar and the euro after the Bank of England said it sees inflation “markedly higher” in the near term, boosting speculation that borrowing costs will rise from record low levels.
The Bank of England left its main interest rate at a record-low 0.5 percent on May 5, three days after King indicated he favors keeping borrowing costs on hold, even as inflation accelerates at twice the bank’s 2% limit.
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