LE: Canadian dollar little changed amid rising commodities, hopes for European rate cut
TORONTO - The Canadian dollar was slightly higher Wednesday amid hopes that the European Central Bank will move to stimulate the continental economy and higher commodity prices.
The loonie added 0.02 of a cent to 97.47 cents US.
Commodity prices were higher Wednesday as the June crude contract on the New York Mercantile Exchange rose 35 cents to US$89.53 a barrel.
May copper improved by six cents to US$3.15 a pound and June bullion gained $17.70 to US$1,426.50 an ounce.
Risk sentiment improved amid evidence that Europe’s economic downturn is affecting its strongest member, Germany.
And there is a growing conviction by many experts that the European Central Bank will cut interest rates from the current record low.
The Ifo business optimism index fell to 104.4 points in April from 106.7 in March, more than the modest dip foreseen by market analysts to 106.2.
European markets have also been buoyed in recent days by progress in Italy to produce a government after inconclusive elections in February. The president was reelected over the weekend and on Wednesday he was expected to ask a center-left politician, Enrico Letta, to form a new executive government.
