Canadian retail sales in August also missed expectations.
The loonie was up 0.11 of a cent to 97.19 cents US a day ahead of the latest interest rate announcement from the Bank of Canada. Many economists believe the bank won't hike rates from its current level of one per cent until the fourth quarter of next year.
The U.S. Labor Department reported that job creation for September came in at 148,000 while the jobless rate dipped 0.1 per cent to 7.2 per cent. Economists had been looking for job gains in the neighbourhood of 180,000.
Also, August job creation was revised upward to 193,000 from 169,000.
The report was to have been released weeks ago but got held up because of the partial U.S. government shutdown, which ended last week.
There has been growing speculation since May about when the Fed might start to taper its monthly purchase of US$85 billion of assets that have kept long-term interest rates low and supported strong gains on many equity markets this year.
Meanwhile, Canadian retail sales edged up 0.2 per cent in August to $40.3 billion, one-tenth of a point less than expectations.
Statistics Canada said higher sales at food and beverage stores were partially offset by weaker sales at motor vehicle and parts dealers and at gasoline stations. Economists had expected an overall gain of 0.3 per cent.
Oil prices continued to decline in the wake of data showing rising inventories. The U.S. government said Monday, in a report delayed five days due to the government shutdown, that U.S. crude supplies rose by four million barrels in the week ended Oct. 11.
The Schork Report estimated that U.S. commercial crude oil stocks are at the third-highest level for October since 1930 and 13 per cent above the normal range over the previous decade.
The November crude contract on the New York Mercantile Exchange dropped $1.42 to US$97.80, its lowest close since June 28.
December copper rose three cents to US$3.34 a pound while December gold bullion rose $26.80 to US$1,342.60 an ounce.