Canadian dollar up ahead of Bank of Canada rate announcement, weak Chinese data
TORONTO - The Canadian dollar closed higher Monday, ahead of a mid-week announcement on interest rates and the economy from the Bank of Canada.
The loonie was well off the highs of the session but still ahead 0.21 of a cent to 91.32 cents US on a relatively quiet day with U.S. markets closed for the Martin Luther King holiday.
Traders will be looking for any change in the Bank of Canada's language about interest rates on Wednesday, along with it's latest take on the economy in its Monetary Policy Report.
The central bank has dropped language that suggested it was biased towards raising rates and adopted a neutral stance, although some observers believe it may ease its monetary policy and lower rates.
"We believe the rate meeting and MPR will reaffirm a dovish tone, but the central bank is likely to stop short of instituting an official easing bias," said Mark Chandler, head of Canadian FIC Strategy at RBC Dominion Securities.
Markets will also digest other major economic data this week. Statistics Canada releases data on manufacturing shipments for November on Tuesday, November retail sales on Thursday and the December reading on inflation on Friday.
January has been a negative month for the Canadian dollar, which is down more than 2 1/2 cents US from the end of 2013, falling near levels that haven't been experienced since September 2009.
The loonie has been buffeted by a variety of factors, including the central bank's dovish tone on interest rates and disappointing trade and employment data.
But it has also been under pressure from an American currency which has risen as the U.S. Federal Reserve starts to cut back on its key stimulus measure, the massive monthly bond purchases that have kept long-term rates low.
Meanwhile, oil and copper prices faltered Monday following the release of data showing a slowdown in the Chinese economy.
The worldâ€™s second-largest economy's annualized growth rate was 7.7 per cent in the fourth quarter, down from the previous quarterâ€™s 7.8 per cent.
Growth for the full year was 7.7 per cent, tying 2012 for the weakest annual performance since 1999.
Factory output, exports and investment all weakened. On a quarter-to-quarter basis, economic growth dropped to 1.8 per cent from the previous periodâ€™s 2.2 per cent.
The February crude contract declined 65 cents to US$93.72 a barrel in late afternoon electronic trading on the New York Mercantile Exchange.
March copper was unchanged at US$3.34 a pound while February bullion rose $2.20 to US$1,254.10 an ounce.
Read more Business News
- Family condemns RCMP BC - 7:49 pm
- Child pornography sentencePenticton / S. Okanagan - 6:13 pm
- Bobbitt hearing continuesPenticton / S. Okanagan - 6:16 pm
- Inquest into teen's Mill deathVernon / N. Okanagan - 4:30 pm
|QHR Technologies Inc||1.12||+0.01|
|Anavex Life Sciences||0.191||+0.001|
|Copper Mountain Mining||1.99||+0.05|
|Sunrise Resources Ltd||0.06||0.00|
|Mission Ready Services||0.45||0.00|
This time of year, I always worry about which friends of mine will get caught going off the road in adverse weather conditions. With a little preparation most accidents can be avoided. Having won the...
Photo: Thinkstock.comThe end of record-low rates is nigh, according to one major bank, which has taken a stance and predicted when the Bank of Canada will raise its long-standing overnight rate. &ldq...
The third week in October is “Small Business Week”, a week dedicated to supporting local, small businesses. The week was designed to bring awareness to Canadians about the role small busin...