Each day TFO Canada publishes a sample of trade news on the Canadian import market along with any new, updated or changed regulations and legislations regarding international trade; countries in which TFO Canada offers services and on the export sectors which it promotes.
Canadian Dollar Hits Highest since March 2008Tuesday, February 22, 2011 > 09:52:54
(Reuters – Ka Yan Ng)
Canada's dollar hit its highest in nearly three years, spurred by cautious optimism on the U.S. economy from the U.S. Federal Reserve and buoyed by a firm oil price and a positive outlook for global equity markets.
The currency jumped as high as C$0.9816 to the U.S. dollar, or $1.0187, its highest since March 2008.
At 8:15 a.m. (1315 GMT), the Canadian dollar was at C$0.9828 to the U.S. dollar, or $1.0175, surpassing the 2011 high reached earlier this month at C$0.9832 to the U.S. dollar, or $1.0171.
It was also firmer than Wednesday's North American session close at C$0.9849 to the U.S. dollar, or $1.0153.
"Although we're at new (dollar/Canada) lows, I'm not sure it's sustainable or if it's going to extend that much," said Shaun Osborne, chief currency strategist at TD Securities, but noted a push beyond C$0.98 could open the way to further Canadian dollar strength. "There's really not that much in terms of technical resistance below these levels."
He said a sustained rally may be helped by significantly higher oil prices, or a renewed widening out in Canada/U.S. short-term rate spreads. But he also cautioned that a stronger Canadian dollar will be noticed by the Bank of Canada.
The Canadian central bank stressed in its January policy-setting that the high-flying Canadian dollar was hampering recovery in the export sector, the backbone of the Canadian economy.
Canadian bond prices were flat to higher across the curve, taking a cue from U.S. Treasuries.
The two-year Canadian government bond was up 1 Canadian cent to yield 1.938%, while the 10-year bond rose 8 Canadian cents to yield 3.493%.