Holidays, fiscal cliff drive Loonie

Photo: The Canadian Press. All rights reserved.

Loonies are shown in Calgary, Alta., July 19, 2012. THsE CANADIAN PRESS/Jeff McIntosh

TORONTO - The Canadian dollar was up slightly on Monday morning as financial markets prepared for the Christmas holiday.

The loonie was at 100.77 cents US, up 0.11 of a cent shortly before markets opened. The currency will trade in a shortened session ending at 12 noon ET.

Key U.S. lawmakers are already predicting that much of their holiday season will be spent in Washington, D.C., as they seek to bridge a gap between the Republican-dominated lower house and the White House.

A deal must be reached if the United States is to avoid going over the so-called fiscal cliff, which would involve the automatic imposition of hundreds of billions of dollars in spending cuts and tax increases that could plunge the world's largest economy back into recession and depress economies around the world.

President Barack Obama said Friday that he is "ready and willing" to get a big package done to deal with the fiscal cliff, adding there's no reason not to protect middle-class Americans from tax increases.

In commodities, the January crude contract on the New York Mercantile Exchange slid 17 cents to US$88.49 a barrel.

March copper was up 1.5 cents at US$3.55 a pound. February bullion added $2.20 to US$1,662.30 an ounce.