Canadian Dollar And Business Outlook

By Commodity News Service Canada

WINNIPEG, January 2 The Canadian dollar was trading at a sharply higher level versus its US counterpart at 9:10 CST Wednesday, as a deal was reached to avoid the effects of the US ‘fiscal cliff’, analysts said.

US lawmakers approved a deficit-reduction plan that will help the country avoid automatic austerity and prevent the US from heading back into a recession. The news had investors more willing to take on riskier assets, including the Canadian dollar.

At 9:10 CST Wednesday, the Canadian dollar was at US$1.0163 or US$=C$0.9840, which compares with Monday’s North American close of US$1.0051 or US$=C$0.9949. Markets were closed on Tuesday for New Years Day.

Strong commodity prices, including crude oil, gold and copper, also helped the Canadian currency move higher above its US counterpart.

There was no significant Canadian economic data to report on Wednesday morning. Statistics Canada’s first releases of 2013 will come out on Friday January 4.

The TSX was up 133.87 points, or 1.08%, at 9:10 CST Wednesday morning to sit at 12,567.40.