(Adds economist quotes and details throughout, updates prices)
Canadian dollar strengthens 0.3% against the greenback
For the week, the loonie advances 0.9%
Price of U.S. oil rises 4.7%
10-year yield climbs to a 3-month high
By Fergal Smith
TORONTO, Oct 7 (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Friday, adding to this week's gains, as oil prices rose and data showed Canada's economy adding jobs for the first time in four months.
The loonie was trading 0.3% higher at 1.37 to the greenback, or 72.99 U.S. cents. For the week, it was up 0.9%, after posting weekly declines in the three previous weeks.
The Canadian economy added 21,100 jobs in September, ending a three-month streak of losses, while the jobless rate dropped to 5.2% from 5.4%.
"It is a bit of a relief to see a plus sign in front of the jobs number," said Doug Porter, chief economist at BMO Capital Markets. "In some ways, this is an ideal report from a (monetary) policy stance ... It's cool but not too cool."
Money markets stuck with bets for the Bank of Canada to hike interest rates by a further 50 basis points at its next policy announcement on Oct. 26, with investors expecting rates to peak at about 4.25% in the coming months.
That compares to the 4% terminal rate that was expected before hawkish comments on Thursday by Bank of Canada Governor Tiff Macklem.
The price of oil, one of Canada's exports, was supported by the OPEC+ decision to make its largest supply cut since 2020. U.S. crude futures were up 4.7% at $92.57 a barrel.
Capping the loonie's advance were gains for the U.S. dollar against a basket of major currencies and losses on Wall Street as solid U.S. job growth gave more room for the Federal Reserve to stick to big-sized interest-rate hikes.
Canadian government bond yields were higher across the curve. The 10-year touched its highest level since June 28 at 3.407% before dipping slightly to 3.392%, up 8.4 basis points on the day. (Reporting by Fergal Smith; Editing by Kirsten Donovan and Cynthia Osterman)