Wednesday, November 26th1.2°C
22246
22916

Canadian dollar tumbles almost half a cent amid disappointing housing data

TORONTO - The Canadian dollar closed sharply lower Thursday as traders took in readings showing a slowdown in the housing sector and looked to the release Friday of December job numbers.

The loonie closed off the worst levels of the session to drop 0.41 of a cent to 92.15 cents US as the currency rides at its lowest level since the end of September 2009. It cracked the 92-cent level during the day, going as low as 91.95 cents US.

Canada Mortgage and Housing Corp. said housing starts for December came in at an annual rate of 189,672 units in December, within expectations of economists but a decrease from 197,797 in November.

"Look for further cooling in starts this year to levels consistent with demographic demand," warned BMO Capital Markets senior economist Robert Kavcic.

Other data from Statistics Canada showed that contractors took out $6.8 billion worth of building permits in November, down 6.7 per cent from October. The agency noted that the decline in December followed an eight per cent gain in November.

The dollar was already down sharply before the housing data came out. The currency has fallen more than 1.75 cents US since last Friday, buffeted by data that showed Canada's trade deficit grew last fall.

Another report showed the U.S. trade deficit dropped 12.9 per cent in November to its lowest level in four years. Imports, including Canadian crude oil, dropped 1.4 per cent.

And the Bank of Canada has turned dovish on interest rates with a hike not expected until next year.

Also, the U.S. dollar has strengthened on speculation about how fast the U.S. Federal Reserve might reduce its massive bond buying program.

The Fed decided last month to start tapering its US$85 billion of monthly bond purchases by $10 billion with further cuts contingent on economic performance, particularly improvements in job creation.

The minutes from that Fed meeting were released on Wednesday but failed to provide clues about what the Fed might do.

However, there is also a growing feeling that Friday's U.S. government employment report for December will exceed expectations that about 195,000 jobs were created. Payroll firm ADP said Wednesday that the U.S. private sector alone created 238,000 jobs in December.

Also on Thursday morning, the U.S. Labor Department reported that applications for jobless insurance fell by 15,000 last week to 330,000.

Canadian jobs data also comes out Friday with expectations that about 13,000 jobs were created in December.

In other economic developments, the European Central Bank left its key interest rate unchanged at a record low 0.25 per cent on Thursday amid worries about a weak recovery and low inflation.

Lower prices for oil and metals also pressured the Canadian currency.

The February crude contract on the New York Mercantile Exchange lost 67 cents to close at US$91.66 a barrel.

March copper lost four cents to US$3.30 a pound while February gold bullion climbed $3.90 to US$1,229.40 an ounce.

The Canadian Press


Read more Business News

23015


Recent Trending




Today's Market
S&P TSX15038.41-35.24
S&P CDNX771.06-9.58
DJIA17827.7512.81
Nasdaq4787.317+29.065
S&P 5002072.83+5.80
CDN Dollar0.8885-0.0003
Gold1196.20-0.40
Oil73.13-0.56
Lumber327.90-1.60
Natural Gas4.295+0.144

 
Okanagan Companies
Pacific Safety0.160.00
Knighthawk0.01-0.005
QHR Technologies Inc1.34+0.02
Cantex0.045+0.005
Anavex Life Sciences0.171-0.004
Metalex Ventures0.035+0.005
Russel Metals31.50-0.64
Copper Mountain Mining2.16+0.01
Colorado Resources0.12-0.01
ReliaBrand Inc0.0134-0.0001
Sunrise Resources Ltd0.045-0.005
Mission Ready Services0.34+0.015

 
24130


23643

FEATURED Property
2120427214 Lochview Road
4 bedrooms 5 baths
$2,195,000
more details
image2image2image2
Click here to feature your property
Please wait... loading


The last great Canadian tax shelter

A guide to how flow-through fund limited partnerships can mightily aid your tax planning!The end of the year will raise concerns among many professionals, self-employed persons, business owners and ev...


What I learned in China: Part 2

As per my previous article on my visit to China, we have much to learn about and from their people. It is potentially the largest market on earth with 1.3 billion people in one country but much will d...


Retirement: Health Issues

Our health is really our greatest asset and maintaining our health is of tremendous importance. You want to do what you can to ensure that health issues will not jeopardize the enjoyment of your retir...

_



24156

24119


Member of BC Press Council


22632