Canadian dollar shakes off early losses as greenback loses momentum
The loonie gained 0.14 of a cent to 101.45 cents US while the currency also continued to find lift from Friday's much stronger then expected December employment report. (file image)
By Malcolm Morrison, The Canadian Press
Published Monday, January 7, 2013 2:19PM CST
Last Updated Monday, January 7, 2013 3:30PM CST
TORONTO -- The Canadian dollar closed higher Monday as commodity prices bounced off the lows of the session and the U.S. currency weakened.
The loonie gained 0.14 of a cent to 101.45 cents US while the currency also continued to find lift from Friday's much stronger then expected December employment report.
The economy created 40,000 jobs last month. Economists thought that only about 5,000 positions would be turned out in December after job creation had surged by 59,000 in November.
The loonie had been lower earlier in the day as the greenback strengthened against many other currencies on speculation that the U.S. Federal Reserve might end its bond-buying stimulus program in the second half of 2013.
The American currency has strengthened in recent days after minutes from the Fed's latest policy meeting last month showed a split over how long to continue the purchases. Some policy-makers have concerns that the continued bond purchases, known as quantitative easing, may destabilize the economy.
The February crude contract on the New York Mercantile Exchange erased early losses and gained a dime to US$93.19 a barrel.
March copper dipped two cents to US$3.69 a pound while February gold bullion shed $2.60 to US$1,646.30 an ounce.
Traders also took in a move by global regulators to ease new rules obliging lenders to set capital aside. The so-called Basel III rules are a set of new international standards to make sure banks don't fall back into the sort of trouble that caused the 2008 financial crash. On Sunday, the officials setting those rules delayed the date by which certain amounts of cash had to be readily available.
Amid the biggest beneficiaries on equity markets were ailing Spanish banks, which some had feared would struggle to meet the new cash requirements.