Wednesday April 23, 2014

question of the week

Survey results are meant for general information only, and are not based on recognised statistical methods.

Home »  News »  Business

Loonie lower after big run-up, metal prices back off on China concerns

Canadian dollars, or loonies, sits on their American counterparts on Sept. 20, 2007 in Montreal. THE CANADIAN PRESS/Paul Chiasson

TORONTO - The Canadian dollar closed lower Friday after surging well over a full US cent the previous session amid a growing likelihood that the U.S. Federal Reserve’s monetary policy will remain loose for the time being.

The loonie edged down 0.1 of a cent to 96.19 cents US.

The loonie's gain of 1.21 cents US came in the wake of reassurances from Fed chairman Ben Bernanke that the central bank was in no hurry to curtail key economic stimulus measures.

The greenback fell sharply after Bernanke said that the U.S. needs a "highly accommodative monetary policy," or low interest rates, for the foreseeable future. The Fed is buying US$85 billion a month in bonds to keep interest rates low.

Traders also looked ahead to next Wednesday and the next interest rate announcement and monetary policy report by the Bank of Canada. It will be the first policy decision by Stephen Poloz since he took the helm at the central bank in early June.

"To this point, there have been very few appropriate times for the governor to play his cards," observed Ian Pollick, fixed income strategist at RBC Dominion Securities. "And it will be very telling how he characterizes both the current economic situation, as well as how he might potentially change the forward-looking language."

Analysts expect the Bank of Canada to leave its key rate unchanged at 1.25 per cent until well into 2014 at least.

Signs of higher demand in the U.S. pushed the August crude contract on the Nymex up $1.04 to US$105.95 a barrel, up 2.6 per cent for the week.

Copper prices were depressed after China’s finance minister suggested that growth could come in at seven per cent for this year, which is below the government’s official forecast.

Surprisingly weak trade figures earlier this week raised the prospect that China’s slowdown will be sharper than anticipated as China’s central bank tightens credit to reduce financial distortions. China releases April-June growth figures on Monday morning and that could well determine trading next week.

The September copper contract on the New York Mercantile Exchange lost two cents to US$3.15 a pound.

August bullion faded $2.30 to US$1,277.60 an ounce.


NOTE: To post a comment in the new commenting system you must have an account with at least one of the following services: Disqus, Facebook, Twitter, Yahoo, OpenID. You may then login using your account credentials for that service. If you do not already have an account you may register a new profile with Disqus by first clicking the "Post as" button and then the link: "Don't have one? Register a new profile".

The Coast Reporter welcomes your opinions and comments. We do not allow personal attacks, offensive language or unsubstantiated allegations. We reserve the right to edit comments for length, style, legality and taste and reproduce them in print, electronic or otherwise. For further information, please contact the editor or publisher, or see our Terms and Conditions.

blog comments powered by Disqus

About Us | Advertising | Contact Us | Sitemap / RSS   Glacier Community Media:    © Copyright 2014 Glacier Community Media | User Agreement & Privacy Policy
Business in Vancouver Whistler Question Squamish Chief Powell River Peak Real Estate Weekly My Local Flyers


Lost your password?