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INSTANT VIEW-Canada surprises with 52,100 new jobs in September

TORONTO, Oct 5 (Reuters) - Canada's economy added a higher-than-expected 52,100 jobs in September, largely due to a spike in full-time work, according to Statistics Canada data released on Friday.

� LINKS: Story: Web: COMMENTARY DOUG PORTER, DEPUTY CHIEF ECONOMIST, BMO CAPITAL MARKETS

"Surprising, in a word. It some ways the Canadian number is almost the polar opposite to the U.S. number. Flashy job gain but a little bit of sour news on the unemployment side because the participation rate went up so much. I think the key point here is the economy is still churning out jobs at a healthy pace. I wouldn't read too much into the month-to-month number but it's impressive and it is not reversing a big decline the prior month, so we can't brush this aside."

"The Bank (of Canada) is still talking a fairly tough games. What they are concerned about is the economy growing faster than potential. The rise in the unemployment rate would suggest maybe not -- and most of the GDP numbers haven't suggested that things are growing faster than 2 percent. So I'm sure there will be some market reaction but I don't think this is going to alter the bank's view dramatically."

"I think the combination of figures is unambiguously positive for the Canadian dollar. On the Canadian side you've got a rip-roaring headline job increase and on the U.S. side you've got a plunge in the unemployment rate and a strong household number. I think the combination is pretty positive for the Canadian dollar."

MARKET REACTION

- The Canadian dollar strengthened to a 10-day high of C$0.9764 to the U.S. dollar, or $1.0242, soon after the U.S. and Canadian data was released, compared to C$0.9810, or C$1.0194, minutes earlier.

- Overnight index swaps, which trade based on expectations for the central bank's key policy rate, showed that traders increased bets on a rate hike in 2013.

(Reporting by Andrea Hopkins, Allison Martell and Julie Gordon; Editing by Jeffrey Hodgson)

((jeffrey.hodgson@thomsonreuters.com)(+1 416 941 8099)(Reuters Messaging: jeffrey.hodgson.reuters.com@reuters.net))

Keywords: CANADA ECONOMY/JOBS