BUSINESS

Loonie racks up modest gain amid higher oil prices, positive economic news

10/25/2012 08:58 EDT | Updated 12/25/2012 05:12 EST
TORONTO - The Canadian dollar closed higher Thursday amid a mixed showing on commodity markets while traders digested positive economic data from the U.S. and Britain.

The loonie gained 0.1 of a cent to 100.61 cents US.

"A broadly weaker U.S. dollar, partially on the back of a better risk environment after the U.K. released a strong GDP report and many are suggesting that the worst is behind us have helped support the Canadian dollar," said Scotia Capital chief currency strategist Camilla Sutton.

Britain’s economy grew by a bigger than expected one per cent, which beat the market consensus forecast of 0.6 per cent growth. It was the strongest quarterly growth in five years and brings economic output back to the same level of a year ago. It is a first estimate and is subject to revision.

There was also good news on the American economic front as orders for durable goods surged 9.9 per cent in September, the largest amount in nearly three years, reflecting a rebound in aircraft orders. That was much higher than the 6.8 per cent gain that economists expected. However, orders for core capital goods, considered a good proxy for business investment, were unchanged in September after a slight August gain.

Oil prices firmed up after five days of losses, including a drop of almost $1 on Wednesday in the wake of data showing a much larger increase in crude inventories last week than had been expected. The December contract on the New York Mercantile Exchange gained 32 cents to US$86.05 a barrel.

But Copper lost two cents to US$3.55 after closing flat Wednesday. But prices for the metal viewed as an economic barometer slid 18 cents in the previous four sessions.

December bullion gained $11.40 to US$1,713 an ounce.