Friday, August 22nd14.5°C
22568

Loonie rises amid mixed U.S. data as investors wait for more hints on key rate

TORONTO - The Canadian dollar headed higher Thursday amid mixed data on whether the U.S. economic recovery remains on track.

The loonie gained 0.43 of a cent to 90.65 cents US.

The Commerce Department says the U.S. economy grew at a 2.6 per cent annual rate from October to December, slightly more than previously estimated, as consumer spending rose at the fastest pace in three years. Analysts had been expecting a growth rate of 2.4 per cent.

The release coincided with figures from the U.S. Labor Department that found jobless claims fell 10,000 last week to a seasonally adjusted 311,000, the lowest since late November and a hopeful sign that hiring could pick up.

Despite that encouraging data, however, the number of Americans who signed contracts to buy homes fell for the eighth straight month in February, indicating that real estate sales will likely slow over the next few months.

Last week, the loonie was pressured after the U.S. Federal Reserve said it could start raising short-term interest rates as soon as next year.

"With the Fed shifting away from its dovish tone it suggests a strong U.S. economic backdrop and therefore an improved global growth outlook, which has supported all the global growth assets...," Camilla Sutton, chief currency strategist for Scotiabank (TSX:BNS), said in a note Thursday.

Sutton said there's a potential that a weaker Canadian dollar will persist if Bank of Canada governor Stephen Poloz lags the U.S. in making similar policy changes, which is what is expected to happen unless there are greater signs of a strengthening economy north of the border.

In another note, Scotiabank said it anticipates the Canadian currency will remain weak through mid-year before stabilizing by the end of the 2014 at about 89 cents if the U.S. economy continues to improve. However, it expects the loonie to weaken further to 88 cents US in 2015.

"The Canadian domestic backdrop is uneven, with expectations of an improvement in net exports and business investment slow to materialize, adding to well-established concerns over general economic slack," the note said.

Meanwhile, commodities were mixed as May crude on the New York Mercantile Exchange climbed $1.01 to US$101.28 a barrel. June gold bullion fell $8.60 to US$1,294.80 an ounce while May copper gained three cents to US$2.99 a pound.

The Canadian Press


Read more Business News

21623


Recent Trending




Today's Market
S&P TSX15556.09-5.86
S&P CDNX1002.205.50
DJIA17018.97-20.52
Nasdaq4527.989-4.116
S&P 5001989.48-2.89
CDN Dollar0.9135-0.0006
Gold1277.70+4.00
Oil96.30+1.82
Lumber355.60-1.10
Natural Gas3.865-0.024

 
Okanagan Companies
Pacific Safety0.18-0.005
Knighthawk0.01-0.005
QHR Technologies Inc1.210.00
Cantex0.065-0.005
Anavex Life Sciences0.260.00
Metalex Ventures0.075-0.01
Russel Metals37.59+0.14
Copper Mountain Mining2.88-0.04
Colorado Resources0.1850.00
ReliaBrand Inc0.095+0.01
Sunrise Resources Ltd0.025-0.005
Mission Ready Services0.215-0.015

 



22997

FEATURED Property
1919547672 Old Meadows Road, Kelowna
3 bedrooms 2 baths
$339,900
more details
image2
Click here to feature your property
Please wait... loading


What is a journey without a destination?

Photo: ContributedI would call it a joy ride... You see a planned project or business has a destination. It may be an ongoing revenue stream, it may be a business value or an exit strategy. If you don...


Joint accounts: what you need to know!

Establishing a joint account may seem like a great strategy at first glance. However, there are many factors that must be considered before taking this action. This article will explore the use of &ls...


Cost of an Injury Lawyer

Let’s face it; nobody wants to pay for legal services if they do not have to, but if you have been injured in an accident you may have thought about hiring a lawyer to help you navigate your cla...

_



22885

23002


Member of BC Press Council


22885