Canadian dollar flat despite robust commodities

Thu Mar 27, 2008 5:05pm EDT
 
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By John McCrank

TORONTO, March 27 (Reuters) - The Canadian dollar was almost unchanged against the U.S. dollar on Thursday as ongoing concerns about the economy of Canada's biggest trading partner kept it from riding robust commodity prices higher.

Canadian bond prices were mixed as investors squared their books heading into the end of the month and the quarter.

The Canadian unit closed at C$1.0184 to the U.S. dollar, or 98.19 U.S. cents, up a tad from C$1.0188 to the U.S. dollar, or 98.15 U.S. cents, at Wednesday's close.

The Canadian dollar has stayed stubbornly in a range of 96.61 U.S. cents to US$1.0256 since the end of November and does not appear to be about to break out of it any time soon, said Shaun Osborne, chief currency strategist at TD Securities.

That is because the U.S. economy is faltering and Canada is thought likely to soon feel the spillover effect from a slowdown in its biggest trading partner.

Investors see little benefit in betting one currency against the other.

"You have to look outside the dollar-Canada exchange rate to really see what's going on with the Canadian dollar," Osborne said.

The currency was weaker against the euro and the pound, and while it was up a touch against the Japanese yen, it has been on a losing streak there too in recent weeks.   Continued...