SF: Canada Dollar Rises for Fourth Day on Global Economic Growth
June 10 (Bloomberg) -- Canada's dollar rose to the strongest level in three weeks on speculation Europe's fiscal crisis will not offset global expansion, boosting demand for assets linked to growth.
The Canadian currency, known as the loonie, has gained 11.5 percent this year, the best performance versus its developed- world counterparts, Bloomberg Correlation-Weighted Indexes show. Reports from China, Japan and Australia showed economic growth. European Central Bank President Jean-Claude Trichet said interest rates in the euro region are "appropriate," indicating he sees no immediate need to cut borrowing costs.
"The market continues to grasp decent economic news," said Jack Spitz, managing director of foreign exchange in Toronto at National Bank of Canada. "These are all influences that have inspired more risk taking."
The Canadian currency climbed 1.3 percent to C$1.0313 per U.S. dollar, at 10:24 a.m. in Toronto, compared with C$1.0445 yesterday. It touched C$1.0288, the lowest level since May 18. One Canadian dollar buys 96.97 U.S. cents. The last time the loonie rose for four consecutive days was in the period ended May 12.
China's exports jumped the most in six years in May, rising 48.5 percent from a year earlier, the nation's customs bureau said, surpassing all 32 estimates in a Bloomberg News survey of economists. Japan's economy grew at an annualized 5 percent rate in the three months through March.
Global Growth
Australian employers added workers in May for a third straight month, the statistics bureau said in Sydney today.
"Monetary policy will do all that's needed to maintain price stability over the medium term," Trichet said at a press conference in Frankfurt today after the ECB left its benchmark rate at a record low of 1 percent.
Canada's central bank on June 1 raised its target interest rate to 0.50 percent from a record low 0.25 percent, the first Group of Seven country to do so since last year's global recession.
"You look at Canada and the health is very good," said Jonathan Gencher, director of foreign exchange sales at Bank of Montreal in Toronto. "It should be a rock star."
The benchmark government five-year bond declined. The yield rose 8 basis points, or 0.088 percentage point, to 2.73 percent. The price of the 2.5 percent security due in June 2015 fell 37 cents to C$98.93.
