The Canadian dollar extended its last Friday advance and gained versus the euro and the Australian dollar as stocks in North America rose, evidencing the loonie’s correlation with equities and commodities markets, which also climbed today as demand for metals surged.
Favorable reports today in Canada pushed the loonie up in currency markets as retail sales in the country advanced for another month, even if less than forecasts estimated, helping the Canadian dollar to rank as the best performer today versus its U.S. counterpart, as demand for gold and other metallic commodities advanced. The Canadian dollar touched the highest level in 2009 versus the euro, as the European common currency has been struggling to remain attractive as concerns in the bloc’s financial system remain intense, declining appeal for assets in the region.
The Canadian dollar is one of traders’ favorite bets for 2010 as demand for commodities is likely to improved, specially in Canada’s trading partner, the United States, fact which is likely to back an uptrend for the loonie versus lower yielding currencies and the euro, since its attractiveness declined significantly during the past weeks.
USD/CAD declined to 1.0571 as of 15:55 GMT from a previous rate of 1.0654 when markets opened yesterday. AUD/CAD traded at 0.9355 from 0.9496.
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