* Canadian dollar at C$1.0982 or 91.06 U.S. cents
* Bond prices lower across the maturity curve
(Adds details, quote, updates prices)
By Leah Schnurr
TORONTO, May 2 The Canadian dollar weakened on
Friday after data showed U.S. job growth increased at its
fastest pace in more than two years in April, giving a boost to
the greenback .
The U.S. economy added 288,000 jobs last month, while the
unemployment rate fell to a 5-1/2 year low of 6.3 percent.
Canada does not release its monthly jobs report until next
week, and the lack of major domestic economic data on Friday
left the currency susceptible to the strengthening U.S. dollar
after the jobs data.
The loonie hit a session low of C$1.1007 shortly after the
data was released, but the currency pared declines as investors
parsed some of the less cheery details of the report,
particularly the decline in the labor force participation rate.
"While the market did get a little bit excited on that
upside surprise, it feels like the market is a little skeptical
in terms of the actual degree of the robustness of that number,"
said Mazen Issa, senior Canada macro strategist at TD Securities
Investors will want to see a few more months of numbers to
determine if the U.S. jobs growth is organic or just a
bounce-back from the weather-related weakness earlier in the
year, Issa said.
"That's why we're starting to see the Canadian dollar
strengthen again after that initial weakness."
The Canadian dollar was at C$1.0982 to the
greenback, or 91.06 U.S. cents, weaker than Thursday's close of
C$1.0961, or 91.23 U.S. cents.
Investors were also watching geopolitical developments
abroad after pro-Russian rebels shot down two Ukrainian
helicopters. Ongoing tensions in Ukraine have prompted risk
appetite in markets to ebb and flow in recent months.
"It seems to me that the situation continues to intensify,
so there is some hesitancy with some market participants, but
there's no real clear indications yet where that situation is
going," Issa said.
Canadian government bond prices were lower across the
maturity curve, with the two-year down 3.6 Canadian
cents to yield 1.087 percent and the benchmark 10-year
down 33 Canadian cents to yield 2.410 percent.
(Editing by Peter Galloway)