C$ hits two-week low on growth fears

Thu Mar 22, 2012 10:06am EDT
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Jon Cook

TORONTO (Reuters) - The Canadian dollar hit a two-week low against its U.S. counterpart on Thursday after disappointing domestic retail data added to global growth concerns following weak Chinese and European manufacturing data.

Strong sales by motor vehicle and parts dealers in January drove a 0.5 percent increase in Canadian retail sales over the month, Statistics Canada said on Thursday. But the data came in below estimates from a Reuters poll of economists that predicted a rise of 1.7 percent.

"The weaker Canadian data suggests that we may see a bit more (Canadian dollar) softness," said Shaun Osborne, chief currency strategist at TD Securities.

The Canadian currency slid back above parity with the U.S. dollar at $1.006 after the data was released. It was at C$0.9974 versus the U.S. dollar, or $1.0026, immediately before the release.

At 9:50 a.m. (1350 GMT), the Canadian dollar stood at C$0.9996 against the U.S. dollar, or $1.0003, down from Wednesday's North American close at C$0.9923 versus the U.S. dollar, or $1.0078. It was its lowest level since March 7.

The currency is down more than 1 percent against the greenback so far this month.

Overnight, the HSBC flash Purchasing Managers' Index, the earliest indicator of China's industrial activity, fell to 48.1 in March from February's four-month high of 49.6. Anything below 50 is viewed as a contraction. <MKTS/GLOB>

Earlier this month China cut its 2012 economic growth target to an eight-year low of 7.5 percent.   Continued...