A strengthening American currency pushed the loonie down 0.35 of a cent to 89.15 cents US as Statistics Canada reported that the economy created 74,100 jobs last month, far above the gain of 20,000 positions that economists had expected.
September was also a big improvement over August, which saw the loss of 11,000 jobs.
The unemployment rate for September fell by 0.2 percentage points to 6.8 per cent — its lowest since December 2008, when the global economy was in the midst of a major downturn.
The loonie has been buffetted for most of the week by the American dollar, which has risen not only because of weakness in the euro currency but also because the latest round of economic worries has discouraged traders from taking on risk. American bond yields have fallen sharply with the benchmark U.S. 10-year Treasury standing at 2.31 per cent Friday morning.
Meanwhile, Bank of Canada governor Stephen Poloz says guidance on the future direction of interest rates should be reserved for use primarily when rates are at their lowest possible point. In a discussion paper released Friday, Poloz said forward guidance reduces uncertainty about the future direction of rates and, when rates can go no lower, it can reassure markets.
The bank makes its next announcement on interest rates October 22.
The commodity sensitive loonie has also been impacted by oil prices which have fallen to 22-month lows because of the rising greenback, lower demand forecasts and rising supplies.
The November crude contract inched up a nickel to a US$85.82 a barrel.
Metal prices also suffered with December copper two cents down to US$3.01 a pound while December gold edged $3.60 lower to US$1,221.70 an ounce.