ND: Canadian dollar jumps to multi-week highs against most majors
The Canadian dollar staged a strong rally against most of its major opponents in mid-morning trading on Monday as crude oil prices drifted higher in the session. The loonie jumped to multi-week highs against the currencies of the U.S and Japan as well as the common unit of Europe.
Crude oil prices edged slightly higher amid choppy early trading on Monday morning. Light sweet crude for February delivery moved to $46.64, up 30 cents on the session. Overnight, oil hit a 2 1/2-week high of $48.68 before turning lower.
Oil had gained as Israeli continued its attack on the Gaza strip, increasing fears supplies from the Middle East could be disrupted. According to reports, more than 500 people have so far been killed in the conflict.
The Canadian dollar advanced to a 2-week high of 1.1912 against the US dollar by 10:45 am ET Monday, compared to last week's closing value of 1.2114. On the upside, 1.19 level is seen as the next target level for the loonie.
In economic news from the U.S, construction spending in November fell by less than economists had expected. According to a report released by the Commerce Department today, construction spending fell by 0.6 percent to an annual rate of $1.078 trillion from a revised October estimate of $1.085 trillion. Economists had been expecting spending to show a more substantial decrease of about 1.2 percent.
Against the Japanese yen, the Canada's dollar climbed a 6-week high of 78.29 by 10:35 am ET. The loonie-yen pair that closed Friday's deals at 76.15 is currently trading at 78.27. If the loonie ticks up further, it may find its near-term target level around 79.
The Canadian dollar also edged higher against the common currency of Europe in early New York trading on Monday. The loonie soared to 1.6226 versus the euro by 10:40 am ET, the highest level since December 11, 2008. On the upside, the loonie may find resistance near 1.5815 in near-term. Currently, the euro-loonie pair is worth 1.6233.
In economic news from the euro area, results of the latest Sentix survey showed that the headline index for Euro zone rose to minus 34.4 in January from a record low level of minus 42.3 logged in December. The index improved in January after declining for six straight months.
The Canadian dollar also drifted higher against the Australian dollar during early New York trading today. The loonie edged higher to 0.8530 against the Aussie by 10:45 am ET, up from previous session's low of 0.8691. The pair is presently trading at 0.8541.
