Canada’s dollar traded touched the strongest level this month after a report showed China’s manufacturing may grow in October for the first time in four months, increasing demand for riskier assets such as stocks and commodities. The loonie, as the currency is nicknamed, rose for a third day against its U.S. counterpart after European leaders meeting in Brussels yesterday outlined plans to assist banks, heading toward a revamped strategy to resolve the region’s debt crisis. Bank of Canada policy makers meeting tomorrow are forecast to hold the central bank’s policy interest rate unchanged at 1 percent. Stocks and commodities rose. “The Chinese PMI numbers have contributed to a risk- positive sentiment in Asia,” said Shaun Osborne, chief foreign- exchange strategist at Toronto-Dominion Bank’s TD Securities unit in Toronto, in a telephone interview. “Dollar-Canada should be well supported around C$1.0050. There’s very good, very consistent demand for U.S. dollars around that point.” Canada’s currency advanced 0.3 percent to C$1.0039 per U.S. dollar at 12:16 p.m. in Toronto, having earlier touched C$1.0022, the lowest since Sept. 21. It weakened against 10 of its 16 most-traded peers. One Canadian dollar buys 99.61 U.S. cents. Stocks, Commodities The Standard & Poor’s 500 Index climbed 1.2 percent, while Canada’s benchmark S&P/TSX Composite Index added 1.3 percent. Copper for three-month delivery advanced 7.4 percent in London. Government of Canada bonds were little changed. The price of the 3.25 percent securities maturing in June 2021 traded at C$107.60. Canada will provide details of its three-year bond offering on Oct. 27. The auction is scheduled for Nov. 2. Bank of Canada policy makers will announce their next rate decision tomorrow at 9 a.m. Toronto time. The bank will keep its rate unchanged at 1 percent, according to all 27 economists surveyed by Bloomberg News. Also tomorrow, Statistics Canada will report retail sales for August. Sales probably increased 0.3 percent from July, according to the average estimate in a Bloomberg survey of 22 economists. Data View “Data is taking a back seat this week,” said C.J. Gavsie, managing director for currency trading at Bank of Montreal, by phone from Toronto. “There’s not a whole lot we will see from Canada that’s going to really move things one way or the other.” The Bank of Canada will release its monetary policy report on Oct. 26, updating its forecasts for the country’s economy that were last revised July 20. European leaders yesterday held their 13th crisis summit in 21 months, debating how to cut Greece’s debt burden, boost the firepower of the region’s bailout fund and bolster banks ahead of another meeting on Oct. 26. “The market is in a wait-and-see mode” regarding Europe, said Gavsie at BMO. “Clearly they are not buying into it just yet. That could mean the next business days are going to be relatively stable.” The loonie has weakened 1.3 percent in the past month, according to Bloomberg Correlation-Weighted Currency Indexes, a gauge of 10 developed-nation currencies. The greenback has declined 3.9 percent, and the yen has lost 3.1 percent of its value. To contact the reporters for this story: Frederic Tomesco in Montreal at tomesco@bloomberg.net To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net

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