Canadian employers added jobs last month while analysts had been expecting no additions, data showed on Friday, helping the loonie hit a two-year high vs euro and move off the nine-day low against the dollar.
Another report showed better housing market strength of the country, helping fight the broad dollar rally amid weaker economic indicators from eurozone and UK.
EUR/CAD plummeted to 1.3334, its lowest since May 2013, and down 0.55% on the day. So far this week, the cross has fallen 2.6%.
USD/CAD had risen to as high as 1.2668 ahead of the job market data, its highest since 1 April, but data pulled it back to 1.2602 shortly after the release.
Against the pound, the Canadian unit has fallen to a near three-week low with worse than expected UK industrial output data also weighing. GBP/CAD slipped 0.41% on the day to as low as 1.8430, its lowest since 21 January.
The net change in employment in March was an addition of 28,700 as a remarkable rebound from the 1000 payroll cuts in February. The consensus was for no change this time.
The unemployment rate stood at 6.8% and the participation rate slightly increased to 65.9% from 65.8%.
Data earlier in the day showed housing starts in Canada was 189,700 in March, up from 151,200 in the previous month but the data failed to arrest the loonie's decline amid rising greenback and as traders awaited the more important employment numbers.
The USD/CAD pair is still up 0.7% on the week, reflecting the broad strength of the US unit. The USD index has risen to a near three-week high of 99.40 on Friday, moving closer to last month's 12-year peak of 100.40.
Thursday's weekly jobless numbers from the US eased the fear that the disappointing March non-farm payroll data may have set a trend. Initial jobless claims for the week to 3 April increased to 281,000 from the previous week's 268,000 but it was less than analysts' forecast of 285,000, as per the data released overnight.
Data in the recent past was mixed with the January GDP data showing the economic contraction was less than expected at the start of the year while building permits numbers disappointing.
Canadian economy contracted only o.1% in January while analysts had been expecting a 0.2% decline in the GDP, reversing the 0.3% growth recorded for December, data showed on 31 March.
The building permits data on 9 April showed the number of permits fell 0.9% in February when the consensus was for a 5% rise reversing the 12.9% fall in January.
All eyes are now on Bank of Canada rate decision and inflation data next week.
On 15th Wednesday, the BoC is likely to leave the main rate at 0.75%, most predictions show, but the statement will be watched for latest rate signals in the evolving global scenario, especially with the big neighbour US. The CPI data for March will be out on Thursday.