Canada’s Dollar Climbs to Highest in Six Weeks as Stocks Rise

By Chris Fournier

Sept. 16 (Bloomberg) -- Canada’s dollar appreciated to the strongest level in more than a month against its U.S. counterpart as stocks and gold climbed and oil held above $70 a barrel, burnishing the appeal of higher-yielding currencies.

“The market is focused on risk parameters,” said Jack Spitz, managing director of foreign exchange in Toronto at National Bank of Canada. “Oil is still trading at $70, which is bullish. Equities are stronger. The U.S. dollar is weaker across the board. It’s all contributing to an appetite for risk which is contributing to a stronger loonie.”

The Canadian currency advanced as much as 0.6 percent to C$1.0661 per U.S. dollar, the strongest since Aug. 4, before trading at C$1.0698 at 8:10 a.m. in Toronto, from C$1.0724 yesterday. One Canadian dollar buys 93.48 U.S. cents.

The dollars of New Zealand and Australia, which like Canada’s rise and fall with stocks and commodity prices, outperformed all of the 16 most-traded currencies tracked by Bloomberg, rising 1.1 percent and 0.8 percent respectively. The U.S. dollar lagged behind all 16 except for the Swiss franc.

“The backdrop does suggest that the Canadian dollar is poised for further strength,” said Spitz, adding “key data” today including a report at 8:30 a.m. on the U.S. consumer price index could be a catalyst for further gains.

To contact the reporter on this story: Chris Fournier in Montreal at cfournier3@bloomberg.net