BUSINESS

Canadian dollar up slightly, ends year lower amid slowing economic conditions

12/30/2011 08:52 EST | Updated 02/29/2012 05:12 EST
TORONTO - The Canadian dollar closed up about a third of a cent Friday but still ended 2011 lower than where it began.

The currency closed up 0.37 of a cent at 98.33 cents US, which would leave the loonie down 2.21 cents this year.

The Bank of Canada posted the Canadian dollar close early Friday because of "substantially lower trading volumes."

The commodity sensitive currency spent most of the first nine months of this year above parity with the U.S. dollar, rising as high as 106.25 cents at the end of July.

Performance of the loonie has suffered amid a slowing Canadian economy while a worsening eurozone government debt crisis has elevated risk and sent traders to the perceived safe haven of U.S. Treasuries.

However, the Canadian dollar could find further lift in the near future.

Scotia Capital chief currency strategist Camilla Sutton said year-end flows are difficult to predict but "it is unlikely that portfolio managers will be increasing their allocation to Europe and if anything will be increasing weightings to the U.S. and strong sovereigns like Canada, Australia, Sweden, etc."

Crude oil prices were lower Friday, with the February crude contract on the New York Mercantile Exchange down 82 cents to US$98.83 a barrel.

Metal prices advanced with February gold on the Nymex up $25.90 at US$1,566.80 an ounce following six days of declines, while March copper advanced seven cents to US$3.44 a pound.