The Canadian dollar gained today despite better-than-expected growth of Canada’s economy. The possible reasons for the weakness were: the strength of the US dollar, the decline of crude oil prices, and other macroeconomic indicators, some of which were not that good.
Statistics Canada reported that gross domestic product increased 0.1% in August, rising for the seventh consecutive month. While that was a small slowdown from the July’s 0.2% rate of growth, the reading was still better than analysts’ forecasts that predicted no change.
The Industrial Product Price Index edged up 0.1% in September. That is compared to zero change forecast by experts and the decline by 0.5% registered in August. At the same time, the Raw Materials Price Index declined 0.9%. Specialists had predicted a smaller drop of 0.5%. The August’s decline got a negative revision from 4.6% to 4.8%.
The better-than-expected growth of US employment helped the US dollar, putting pressure on dollar-priced commodities. And that translated in weakness of currencies related to raw materials.
USD/CAD climbed from 1.3111 to 1.3161 as of 17:48 GMT today. EUR/CAD traded at 1.4879 after opening at 1.4873 and rising to the daily high of 1.4909. CAD/JPY declined from 86.23 to 85.89.
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