Dollar ends losing week with lower close

Fri Apr 11, 2008 4:31pm EDT
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By Frank Pingue

TORONTO (Reuters) - The Canadian dollar slipped versus the U.S. dollar on Friday and closed lower for the week as nagging concerns about the impact of the U.S. economic slowdown on Canada weighed on the currency.

Canadian bond prices finished higher across the curve as weak U.S. economic data and a disappointing profit outlook from General Electric (GE.N: Quote) convinced investors to unload equities in favor of more secure assets such as government debt.

The Canadian dollar closed at C$1.0234 to the U.S. dollar, or 97.71 U.S. cents, down from C$1.0188 to the U.S. dollar, or 98.15 U.S. cents, at Thursday's close.

For the week, the Canadian dollar fell 1.4 percent, erasing a two-week win streak during which the currency rose 1.4 percent.

The Canadian dollar has been wedged in a range of about 97 U.S. cents and C$1.03 for months and it is not expected to bust out of the range any time soon as the market has been showing little interest in North American currencies.

"With the overseas currencies it looks like you're seeing the U.S. dollar moving down a bit ... but we haven't seen that play out with respect to the Canadian dollar," said Paul Ferley, assistant chief economist at Royal Bank of Canada.

"So maybe some concerns about weakness in the U.S. spilling over to Canada has prevented the loonie from benefiting from the move lower in the U.S. dollar versus overseas currencies."

The slide in the Canadian dollar came early in the session before it settled into a tight range ahead of the weekend.   Continued...