Canadian Forex Midday: C$ Strengthens

By Commodity News Service Canada

Winnipeg, January 11 – The Canadian dollar was trading at a stronger level versus its US counterpart at midday Friday, as a new stimulus program announced in Japan made traders optimistic about global economic conditions, analysts said.

At 11:47 CST Friday, the Canadian dollar was trading at US$1.0168, or US$1=C$0.9834, which compares with Thursday’s North American close of US$1.0157, or US$=C$0.9845.

Thursday’s positive comments from the European Central Bank (ECB) also continued to underpin the value of the Canadian dollar. ECB President Mario Draghi said at a news conference that there are already signs that the euro zone economy is stabilizing, and it should recover by the end of 2013.

However, weak North American trade data limited the Canadian unit’s upside potential. Both Canadian and US trade deficits widened more than anticipated in November.

According to Statistics Canada, Canada’s trade deficit with the world widened from C$552 million in October to C$2 billion in November. Exports decreased 0.9% while imports rose 2.7%.

Weakness in commodity prices, including crude oil, gold and copper, also undermined the Canadian currency.

The Toronto Stock Exchange was down 38.90 points, or 0.31%, at 11:47 CST Friday, to sit at 12,560.84.