• Canadian dollar gains 0.1% against the greenback
• Touches a six-month low at 1.4034
• Canada adds 60,400 jobs in September
• Canada-U.S. 10-year spread narrows 5.9 basis points

TORONTO, Oct 10 (Reuters) - The Canadian dollar rose against its U.S. counterpart on Friday as stronger-than-expected domestic jobs data reduced bets on another Bank of Canada interest rate cut this month, but the move was limited as oil prices fell.

The loonie was trading 0.1% higher at 1.40 per U.S. dollar, or 71.43 U.S. cents, after touching its weakest level since April 10 at 1.4034. For the week, the currency was down 0.4%, its third straight weekly loss.

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Canada's economy added 60,400 jobs in September, almost entirely reversing losses of the previous month, while the unemployment rate held steady at 7.1%. Economists had forecast a 5,000 jobs gain.

"Overall, we would definitely characterize this as a solid and encouraging report," said Doug Porter, chief economist at BMO Capital Markets. "We've been leaning to a hold in late October. This somewhat helps that story but it's a close call."

Investors see a roughly 50% chance the BoC lowers interest rates at its next policy decision on October 29, down from 72% before the data.

The central bank eased its benchmark rate by a quarter of a percentage point last month to 2.50%, its first cut since March, supporting an economy buffeted by trade uncertainty.

The price of oil , one of Canada's major exports, settled 4.2% lower at $58.90 a barrel as confidence grew that the Gaza peace agreement between Israel and Hamas was taking hold.

Canadian government bond yields eased across a flatter curve as Wall Street sold off sharply on increased trade tensions between the U.S. and China.

The 10-year was down 4.3 basis points at 3.169%, while the gap between it and the U.S. equivalent narrowed by 5.9 basis points to about 88 basis points in favor of the U.S. note.

That was the smallest gap since September 16. The bond market closed early ahead of the Thanksgiving Day holiday on Monday.

https://www.reuters.com/legal/litigation/canadian-dollar-rebounds-six-month-low-jobs-gain-2025-10-10/