Dollar up as traders focus on GDP
Aug 27, 2012 / 9:55 am
The Canadian dollar was higher Monday as traders focused on central bankers and the latest snapshot of Canadian economic growth.
The currency was up 0.25 of a cent to 101.1 cents US.
The latest reading of Canadian gross domestic product comes out Friday.
The consensus calls for economic growth of 0.1 per cent in June, the same reading as in May. This would add up to annuallized growth of 1.6 per cent.
Markets ended last week on a positive note after the Wall Street Journal reported that U.S. Federal Reserve chairman Ben Bernanke had written a Republican lawmaker saying there was room for the central bank to do more to help the recovery.
And now traders are looking ahead to the Fed's annual retreat in Jackson Hole, Wyo., later this week. Bernanke delivers a keynote speech Friday while European Central Bank president Mario Draghi speaks on Saturday.
Meanwhile, there were signs that the weakening eurozone economy in starting to affect Germany, Europe's biggest economy.
German business optimism, as calculated by the Ifo business survey, fell more than expected in August.
The index released Monday fell to 102.3 points in August, down from a revised 103.2 in July. Market analysts expected 102.6.
Oil prices backed off from the highs of session with the October crude contract on the New York Mercantile Exchange down 98 cents to US$95.17 a barrel.
Prices had been higher earlier Monday but backed off on increased speculation that the U.S. will release oil from reserves to ease the commodity's rising cost.
Forecasts for tropical storm Isaac also moderated, easing concerns that the storm would damage to key oil and gas operations in the Gulf of Mexico. Precautionary rig evacuations ahead of the storm have already shut about a quarter of the Gulf's offshore oil output
Other commodities were also lower with September copper off a penny at US$3.47 a pound while December gold dipped 80 cents to US$1,672.10 an ounce.
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