Canadian dollar a touch higher but stuck in range

Thu Jul 24, 2008 9:35am EDT
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By Frank Pingue

TORONTO (Reuters) - The Canadian dollar was flat versus the U.S. dollar on Thursday and appeared unlikely to get a chance to reclaim losses suffered earlier this week given the absence of any domestic data to spark a move.

Domestic bond prices, with no domestic data to consider until next week, were mostly higher given a slate of data that continues to suggest the global economy is weakening.

At 9:10 a.m., the Canadian unit was at C$1.0100 to the U.S. dollar, or 99.01 U.S. cents, up from C$1.0103 to the U.S. dollar, or 98.98 U.S. cents, at Wednesday's close.

The currency is down about 0.5 percent this week after data showed domestic spending has started to sink while the annual inflation rate rose more than expected in June.

But with an empty data calendar in Canada for the rest of the week, traders appeared content letting the Canadian dollar bounce back and forth in a tight range versus the greenback.

"The lack of domestic data and the flattish tone to both crude oil and gold are contributing to a consolidative session for the Canadian dollar," said Jack Spitz, managing director of foreign exchange at National Bank Financial.

The Canadian dollar's link to commodity prices has dwindled compared with last year when lofty prices for oil and gold were a key driver in the currency's surge.

But Canada remains the top supplier of crude to the United States and moves in the commodity still have an impact on the currency, but now they are less seldom and less noticeable.   Continued...

<p>A Canadian one dollar coin, also know as a loonie, is shown in Montreal in this April 28, 2006 file photo. REUTERS/Shaun Best</p>