January 23, 2009 / 8:42 PM / 12 years ago

Canada dlr hits one-week high as commodities jump

 TORONTO, Jan 23 (Reuters) - The Canadian dollar rallied to
its highest level in over a week on Friday afternoon as a rally
in prices for key Canadian exports like oil and gold helped
support the currency.
 By mid-afternoon, the Canadian dollar had rallied as high
as C$1.2267 to the U.S. dollar, or 81.52 U.S. cents, which
marked the domestic currency's highest level since Jan. 14.
 The key drivers behind the Canadian dollar rally was a more
than 4 percent surge in gold prices to break above the $900 an
ounce level and a 6 percent jump in oil prices given mounting
evidence that OPEC is complying with the bulk of its record
output cuts
 While the Canadian currency has since backed off from its
session high, its ability to stick comfortably higher took some
currency experts by surprise given the weakened state of the
global economy and the likely drop in demand for commodities.
 "The resiliency of this move was somewhat shocking given
the backdrop that's going on," said David Watt, senior
economist at RBC Capital  Markets. "The global economy still
doesn't look like it's at a great stage for commodity
currencies to do spectacular."
 By 3:30 p.m. (2030 GMT), the Canadian unit was at C$1.2359
to the U.S. dollar, or 80.91 U.S. cents, up 1.4 percent from
C$1.2537 to the U.S. dollar, or 79.76 U.S. cents, at Thursday's
 (Reporting by Frank Pingue; Editing by Jeffrey Hodgson)

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