After a bearish previous week, the loonie reached a 6-month high against the dollar as national employers added jobs and optimistic data from the U.S. indicate that the recession may be easing.
During this week, the loonie was a fantastic investment for traders, rising more then 2.4 percent against the greenback, reaching a 6-month high. Canadas currency uptrend is being highly influenced by the growing demand for crude oil in Asia, which reached the price of $58 for a barrel in this weeks closing session. Unemployment in Canada did not confirm the expectations of speculators, which forecast a rise, this report added confidence in the domestic economy. The Canadian dollar is the most correlated currency with equity markets, and since stocks rallied globally this week, it also pushed the loonie up.
Economists stress that traders should consider the Canadian dollar as long as the stocks rally proceeds and the oil price surges, since Canada is a main commodity exporter for the United States and other important economies. These opinions, according to experts, also extent to the Australian and New Zealand dollars, currencies which can work as indicators for confidence and demand on global markets.
USD/CAD closed at 1.1492 dropping from 1.1725, which is a very significant fall, CAD/JPY closed after rallying from 84.45 to 85.63.
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