Loonie Climbs vs. Greenback as Global Economic Outlook Brightens

The Canadian dollar surged against its US counterpart as the signs of the global economic growth boosted crude oil and increased the appeal of the commodity currencies. The currency slipped versus the euro, which strengthened today against other major currencies.

The sentiment across the markets was really positive yesterday. The MSCI World Index gained as much as 2.2 percent. One of the reasons for the optimism was the statement of European Central Bank’s President Jean-Claude Trichet, who said that the financial stability of the Eurozone isn’t threatened and signaled that the stimulus may be added to the European economy. The mood was further improved as the reports showed the better-than-expected growth of China’s manufacturing and the US employment.

The Canadian employment report released on December 3rd is expected to be also positive. Analysts forecast it to show the increase by 17,900 job places in November, following the growth by 3,000 in October. Futures on crude oil, the largest export of Canada, rose as much as 3.2 percent to $86.81 per barrel.

USD/CAD dropped from 1.0261 to 1.0169 yesterday, following the decline to the intraday low of 1.0140, and traded at 1.0180 as of 00:25 GMT today. EUR/CAD rose from 1.3321 to 1.3359 on the yesterday’s trading session after it reached the intraday high of 1.3396. Now the currency pair trades at about 1.3347. It looks like the currency pair attempt to reverse their yesterday trend.

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