U.S. dollar net long positioning rose for a second straight week. U.S. dollar positioning was derived from net contracts of International Monetary Market speculators in the Japanese yen, euro, British pound, Swiss franc, as well as Canadian and Australian dollars. U.S. dollar net longs increased after Federal Reserve Chair Jerome Powell delivered hawkish testimonies early this week despite the emergence of the highly-transmissible Omicron coronavirus variant.
The Canadian dollar weakened against its U.S. counterpart on Friday as investors took advantage of a jump in the currency after stronger-than-expected domestic jobs data to add to bearish bets, with the loonie extending this week's decline. The loonie was trading 0.2% lower at 1.2829 to the greenback, or 77.95 U.S. cents, after touching its weakest level since Sept. 21 at 1.2846. "We have seen a swift move lower in risk appetite ever since the stock market opened," said Erik Bregar, an independent FX analyst.
Wall Street's major indexes fell as investors grappled with a disappointing U.S. jobs gain and uncertainty around the potential impact of the Omicron coronavirus variant, while the price of oil, one of Canada's major exports, settled 0.4% lower at $66.26 a barrel. Canada's economy posted a job gain of 154,000 in November, eclipsing estimates for an increase of 35,000, while the jobless rate dropped to a new pandemic low. Economists say the data is unlikely to change the Bank of Canada's guidance at a policy announcement next week amid worries over the new variant and after massive recent flooding in British Columbia that has hampered trade through Vancouver.