Loonie Rallies as Commodities, Oil Advances

The Canadian dollar gained today, erasing its losses against the US dollar, as commodities rallied and crude oil, the key export of Canada, advanced to the highest level in more than two years, attracting investors to Canada’s assets.

May delivery for crude oil gained 0.9 percent to $106.69 per barrel in New York before trading at $105.17. The commodity has advanced 8.5 percent so far this month. April futures for gold delivery jumped to the record high of $1,448.60 per ounce in New York before retreating to $1,428. The Reuters/Jefferies CRB Index of raw materials gained 0.4 percent. The Standard & Poor’s 500 Index rose 1 percent and the MSCI World Index of equities went up 0.9 percent, rising for the sixth day in the longest rally since September.

The Canadian currency also strengthened as the speculation that Portugal will receive a bailout boosted risk appetite of investors. The currency may weaken as the opposition is preparing to announce a non-confidence motion against the Canadian government, but some analysts say that such political moves will be discounted by markets.

USD/CAD dropped from 0.9811 to 0.9758 as of 21:28 GMT today. CAD/JPY jumped from 82.45 to 82.97.

If you have any questions, comments or opinions regarding the Canadian Dollar,
feel free to post them using the commentary form below.