(RTTNews) - The Canadian dollar advanced Monday in early trading as crude oil, the nation's key export, is trading in positive terrain even as the Hurricane Irene swept up the U.S. east coast causing little or nil impact to refiners and terminals.
The U.S. Federal Reserve Chairman Ben Bernanke's confirmation to use appropriate tools to ensure a stronger recovery also lifted risk-appetite in the market.
Light Sweet Crude Oil (WTI) futures for October delivery edged up $0.65 to $86.02 a barrel. Last week, oil gained nearly 4 percent as risk appetite improved amid a recovery in global stocks.
Addressing a select group of central bankers and top economists at the Fed's annual retreat on Friday, Bernanke did not offer a third round of quantitative easing and warned that Fed policy should not be viewed as a cure-all for the ailing economy, but assured that the central bank stands ready to help if the economy deteriorates.
The market reactions were, however, positive on hopes that the Fed will take effective measures in its September meeting to put the derailed economy on track as the Federal Open Market committee meeting in the coming month will be extended by one day to discuss on further monetary stimulus.
The Canadian dollar advanced above the 78.50 against the yen, hitting as high as 78.59, after having dropped below 77.25 on Friday. The pair is presently trading at 78.55 and a move above the 78.80 resistance could set its strongest mark in nearly 3-weeks.
Japanese Finance Minister Yoshihiko Noda was elected today as head of the ruling Democratic Party of Japan, edging out Trade and Industry Minister Banri Kaieda. He will succeed Prime Minister Naoto Kan who resigned on August 26.
Noda won 215 votes in the run-off held in the afternoon, while Kaieda received 177 votes. Noda was helped in the run-off by supporters of Foreign Minister Seiji Maehara Maehara, in addition to his supporters as well as Kan's.
Rebounding from last week's multi-day lows, the Canadian dollar strengthened to a 4-day high of 1.4148 against the euro around 7:30 am ET. On the upside, 1.4130 is seen as the next likely resistance level for the loonie.
The Canadian dollar appreciated above 0.6 percent to reach a fresh 3-week high of 0.9766 against the US dollar from Friday's closing value of 0.9820. If the loonie strengthens further, it may find target around the 0.9740 level.
Traders are now looking for economic data in the North American session, in which the U.S. personal income and spending and pending home sales-all for July are slated for release.
