TORONTO, March 10 (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Friday as data showed Canada's economy added more jobs than expected in February, while investors also weighed U.S. jobs data and signs of stress in the banking sector.
The loonie was trading 0.4% higher at 1.3770 to the greenback, or 72.62 U.S. cents, after earlier touching near a five-month low at 1.3861. For the week, the currency was on track to decline 1.3%.
The Canadian economy added 21,800 jobs in February, exceeding analyst forecasts of a gain of 10,000, while the jobless rate unexpectedly held steady at 5.0%, which could leave the door open to additional interest rate hikes by the Bank of Canada (BoC).
The Canadian central bank needs more evidence to gauge if interest rates are high enough to tame inflation, in part because the economies of major trading partners are doing better than forecast, BoC Senior Deputy Governor Carolyn Rogers said on Thursday.
On Wednesday, the BoC left its benchmark rate on hold at a 15-year high of 4.50% after eight consecutive rate increases.
The U.S. dollar fell against a basket of major currencies after the U.S. unemployment report for February showed inflation pressures were easing.
Wall Street was also lower, as banking stocks sagged amid reports that SVB Financial Group's (SIVB.O) efforts to raise money had failed.
A rout in the lender's stock has spread concern about hidden risks in the banking sector and its vulnerability to the rising cost of money.
Canadian government bond yields were sharply lower across the curve, tracking the move in U.S. Treasuries. The 10-year fell 15.6 basis points to 3.00%, its lowest level since Feb. 9.
The price of oil , one of Canada's major exports, was up 0.5% at $76.12 a barrel.
