BUSINESS

Canadian dollar dips, Republicans offer short-term extension to debt ceiling

10/10/2013 08:29 EDT | Updated 01/23/2014 06:58 EST
TORONTO - The Canadian dollar closed little changed Thursday amid optimism over a development in Washington that could avert a possible U.S. default.

The loonie dipped 0.02 of a cent to 96.19 cents US after House Speaker John Boehner said Republicans are offering legislation that will allow for a temporary increase in the U.S. debt ceiling.

Boehner said the proposal involves extending the government’s ability to borrow money through Nov. 22 — but only if President Barack Obama agrees to negotiate over ending the partial government shutdown and a longer-term increase in the debt ceiling.

A partial shutdown of the U.S. government is in its 10th day and a deadline to raise the debt ceiling is just a week away. Under the Republican plan, the partial government shutdown would continue. Boehner said that issue would be discussed at a White House meeting later Thursday after the markets close.

The biggest worry has been the debt ceiling: if it’s not raised, the U.S. could default on its debts.

Prices for oil and copper improved on word of the possible Washington gridlock fix.

Oil prices advanced with the November crude contract on the New York Mercantile Exchange moving up $1.40 to US$103.01 a barrel.

December copper was ahead two cents at US$3.25 a pound while December gold bullion declined $10.30 to US$1,296.90 an ounce.

Traders also looked ahead to the major piece of Canadian economic data coming out this week. Statistics Canada is expected to report on Friday that the economy created about 16,000 jobs in September.