• Canadian dollar falls 0.6% against the greenback
• Touches its weakest since May 8 at 1.3758
• Canada's jobless rate rises to 6.2%
• Canada-U.S. 10-year spread widens to 95.4 basis points

TORONTO, June 7 (Reuters) - The Canadian dollar fell to a near one-month low against its U.S. counterpart on Friday as stronger-than-expected U.S. jobs data boosted the greenback, while a domestic jobs report gave mixed signals on prospects of further Bank of Canada rate cuts.

The loonie was trading 0.6% lower at 1.3750 to the U.S. dollar, or 72.73 U.S. cents, after touching its weakest since May 8 at 1.3758.

"We've seen U.S. yields spike, the (U.S.) dollar spike and CAD is just on the wrong end of all that," said Erik Bregar, director, FX & precious metals risk management at Silver Gold Bull.

"I think the (U.S. non-farm payrolls) report is full of holes but the market wasn't positioned correctly for the higher than expected headline and the higher than expected wages."

The U.S. economy created far more jobs than expected in May and annual wage growth reaccelerated, reducing the likelihood the Federal Reserve will be able to start rate cuts in September.

Canada's jobless rate edged up to a more than two-year high of 6.2% in May and wage growth gathered pace, giving diverging signals on how the Bank of Canada will digest the reading for its next rate decision in July.

Money markets see a 46% chance the central bank would cut next month, down from roughly 50% before the data.

On Wednesday, the BoC became the first G7 central bank to lower borrowing costs, cutting its benchmark interest rate by 25 basis points to 4.75%.

Canadian government bond yields moved higher across the curve but by not as much as U.S. Treasuries.

The 10-year was up 6.4 basis points at 3.458%, while it was trading 95.4 basis points further below the U.S. equivalent, which is the largest gap in LSEG data going back to 1994.

Sign up here.

https://www.reuters.com/markets/currencies/c-hits-one-month-low-us-bond-yields-jump-2024-06-07/