Canadian Dollar Jumps as Europe & USA Bring Good News

The Canadian dollar jumped by the end of this trading week as Europe moved closer to resolution of the sovereign-debt crisis, while the confidence of US citizens improved. Earlier, the currency declined, dragged down by fears that the European Union wouldn’t make headway with battling the crisis.
The European leaders made a statement that showed that the members of the EU are striving for a stronger fiscal consolidation:

Today we agreed to move towards a stronger economic union. This implies action in two directions:
– a new fiscal compact and strengthened economic policy coordination;
– the development of our stabilisation tools to face short term challenges.

There were rumors that most EU countries haven’t completely agreed on all the measures that were proposed. The statement demonstrated that at least some agreement was achieved. There will be more discussions during the weekend, so traders may see new information at the beginning of the next week.
The data from the United States, the biggest trading partner of Canada, was also good. The University of Michigan Sentiment index rose from 64.1 to 67.7, according to the preliminary estimate. The US trade balance deficit decreased a little in October.
USD/CAD fell from 1.0227 to close at 1.0168, while CAD/JPY rallied from 75.86 to 76.24. EUR/CAD closed at 1.3610 after opening at 1.3643 and jumping as high as 1.3711.

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