After spending the first half of the week languishing against peers like the US Dollar and Pound the ‘Loonie’ was able to recover ground on Thursday as hopes that the US economic recovery will continue to gather momentum boosted Canada’s own growth prospects.
While gains against the US Dollar were limited as expectations that encouraging US reports will push the Federal Reserve into tapering stimulus further at its January meeting lifted the ‘Greenback’, the Canadian Dollar was somewhat supported by stronger-than-forecast US construction, manufacturing and initial jobless claims data.
In the worlds of currency strategist Camilla Sutton; ‘We have a US growth story that looks fairly strong, as well as shifting Fed policy which is all supportive of the US Dollar. The domestic side of Canada is pretty quiet’.
That being said, the ‘Loonie’ was able to advance on the Pound following the release of Canadian manufacturing data.
Although the RBC PMI was at a four-month low in December as a result of slowing output/new order growth, it still came in above the 50 mark separating growth from contraction, indicating that business conditions in the sector continued to improve as the year drew to a close.
In the News Release RBC economist Paul Ferley asserted; ‘While output and new order growth ebbed in December following a particularly strong month in November, Canada’s manufacturing sector continued to grow, registering a solid 53.5. Our outlook for 2014 is underpinned by the assumption that Canadian exports will firm as the US continues on a path of recovery – this will provide a healthier environment for manufacturing to further grow in the New Year.’
The report detailed that the volume of new orders rose for the ninth month as a result of increased domestic and global demand.
During the European session the Pound had rallied against its rivals as the UK manufacturing sector grew for the ninth month.
As the weekend draws near, tomorrow’s UK construction data is likely to be the main cause of CAD/GBP movement.
However, investors will also be looking ahead to next week’s Canadian trade balance figures.
Current Canadian Dollar (CAD) Exchange Rates:
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The Canadian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9425 >
The Canadian Dollar /Euro Exchange Rate is currently in the region of: 0.6898 >
The Canadian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5723 >
The Canadian Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0592 >
The Canadian Dollar /New Zealand Dollar Exchange Rate is currently in the region of: 1.1462 <
The Pound Sterling/Canadian Dollar Exchange Rate is currently in the region of: 1.7476 <
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0620 <
The Euro/Canadian Dollar Exchange Rate is currently in the region of: 1.4502 <
The New Zealand Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.8747 >
The Australian Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.9440 <
(Correct as of 15:10 GMT)
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