Canada’s dollar appreciated to the highest level since November 2007 as the greenback declined against all of its major counterparts on concern the U.S. may fail to reach agreement on raising its debt cap. The loonie, as the currency is sometimes known, underperformed its commodity-based peers, the dollars of New Zealand and Australia, as President Barack Obama said the U.S. may experience a “deep economic crisis” if leaders fail to reach a compromise on spending cuts and the nation defaults. The U.S. is Canada’s largest trading partner. “The lack of progress is obviously putting the U.S. dollar back under some pressure, and we’ve seen that coming through pretty much across the board,” said Ian Stannard, head of European foreign-exchange strategy at Morgan Stanley, by phone from London. “We’re still looking for the Canadian dollar to be a relatively stronger performer. A lot will depend on the flow of data from the U.S.” The Canadian currency gained 0.6 percent to 94.15 cents per U.S. dollar at 8:01 a.m. in Toronto, compared with 94.72 cents yesterday. It touched 94.12 cents, the strongest level since Nov. 9, 2007. One Canadian dollar buys $1.0623. Obama blamed the stalemate on a group of Republicans in the House who are insisting on budget cuts and no tax increases. “If we stay on the current path, our growing debt could cost us jobs and do serious damage to the economy,” Obama said in a prime-time address yesterday from the White House. “If they fail to come to an agreement and they fail to raise the debt ceiling, then it could be a very different picture,” said Morgan Stanley’s Stannard. “Then I think the risk is it does start to spill over then into having a broader negative impact on risk appetite. But we continue to believe the U.S. authorities will come to an agreement.” To contact the reporter on this story: Chris Fournier in Halifax, Nova Scotia at cfournier3@bloomberg.net To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net

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