Canada Dollar Gains to Strongest Since October on Global Growth

Canada Dollar Gains to Strongest Since October on Global Growth
Share Business ExchangeTwitterFacebook| Email | Print | A A A By Ye Xie

Dec. 29 (Bloomberg) -- Canada’s dollar climbed to the strongest level against its U.S. counterpart since October as signs the economic recovery is accelerating worldwide spurred demand for currencies tied to global growth.

The Canadian currency headed for a second monthly gain after an appreciation beyond C$1.04 prompted investors to exit bearish bets on it, traders said. Reports in the U.S. today are forecast to show consumer confidence is rising and a drop in home prices is easing for Canada’s largest trading partner. Global stocks and U.S. stock futures rose.

Canada’s dollar, nicknamed the loonie for the image of the waterfowl on the C$1 coin, strengthened 0.4 percent to C$1.0386 per U.S. dollar at 8:43 a.m. in Toronto, from C$1.0429 yesterday. It touched C$1.0375, the strongest level since Oct. 20, and was poised for a 39 percent gain for the decade. One Canadian dollar buys 96.29 U.S. cents.

“We continue to believe that both technicals and fundamentals will push dollar-Canada down,” Camilla Sutton, a Bank of Nova Scotia currency strategist in Toronto, wrote in a research note to clients today. “Markets have been increasingly focused on the relative strengths of Canada, and in low- liquidity holiday trading it appears that flows are biased to sell dollar-Canada.”