BLBG: Canada Dollar Gains After January Trade Deficit Report
The Canadian dollar strengthened from an almost eight-month low against its U.S. counterpart as the nation recorded the smallest merchandise trade deficit in almost a year in January.
The deficit of C$237 million ($230 million) followed a revised December shortfall of C$332 million, Statistics Canada said in Ottawa. Economists surveyed by Bloomberg forecast the deficit would be C$600 million, based on the median of 20 forecasts. The currency fell yesterday after the Bank of Canada left the benchmark interest rate unchanged and said the current level will “remain appropriate for a period of time.”
“We’ve almost priced in everything we can negative into Canadian dollar, so it’s about time for a rebound,” said Eimear Daly, a currency market analyst at Monex Europe Ltd. by phone from London. “It’s moving on a positive outlook for equities, the performance of the Dow Jones has really astounded people and we’ve seen a lot of resilient U.S. data coming out.”
The loonie, as the Canadian dollar is known for the image of the aquatic bird on the C$1 coin, was little changed at $1.0316 per U.S. dollar at 8:33 a.m. in Toronto. One loonie buys 96.94 U.S. cents. The loonie touched C$1.0337 per U.S. dollar yesterday, near its lowest since June.
The Dow Jones Industrial Average of U.S. stocks extended a record high yesterday.
To contact the reporter on this story: Ari Altstedter in Toronto at aaltstedter@bloomberg.net
To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net
