Canadian dollar strengthens the most in nearly 4 weeks as oil soars

Wed Sep 28, 2016 8:31pm EDT
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By Fergal Smith

TORONTO (Reuters) - The Canadian dollar strengthened the most in nearly four weeks against its U.S. counterpart on Wednesday as oil prices soared on a deal by major oil producers to limit output.

U.S. crude oil futures CLc1 settled up $2.38 at $47.05 a barrel after sources told Reuters that the Organization of the Petroleum Exporting Countries has struck a deal to limit crude output at its policy meeting in November. [O/R]

The OPEC news gave the Canadian dollar a boost after the currency had been pressured recently by soft domestic data and dovish comments from Bank of Canada Governor Poloz, said Amo Sahota, director at Klarity FX.

The Canadian dollar CAD=D4 ended at C$1.3109 to the greenback, or 76.28 U.S. cents, much stronger than Tuesday's close of C$1.3203, or 75.74 U.S. cents.

The currency's weakest level was C$1.3269, while it touched its strongest since Friday at C$1.3087.

The loonie's 0.7 percent gain was the most since Sept. 2.

The U.S. government reported that U.S. core capital goods orders rose for the third straight month in August, a positive signal for the business investment outlook.

A pickup in U.S. business investment would improve the outlook for Canada's non-energy exports.   Continued...

A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto January 23, 2015.  REUTERS/Mark Blinch