BUSINESS

Canadian dollar, commodities rise as markets relieved over Chinese growth data

10/21/2014 08:39 EDT | Updated 12/21/2014 05:59 EST
TORONTO - The Canadian dollar jumped almost half a U.S. cent Tuesday while commodity prices headed higher in the wake of Chinese growth data that came within expectations.

The dollar gained 0.44 of a cent to 89.06 cents US as China's economic growth slowed to a five-year low of 7.3 per cent last quarter.

That was lower than the 7.5 per cent rate that had been targeted by Chinese leaders, who are trying to steer China toward growth based on domestic consumption instead of overreliance on trade and investment. But the number was broadly in line with expectations and higher than some estimates that had pegged growth at 7.2 per cent.

Other data showed growth in industrial production was largely stable, with a rate of 8.5 per cent year on year in the first three quarters, down 0.3 point from the first half. Growth in consumer spending cooled to 11.6 per cent in September, the fourth monthly decline in a row.

On the commodity markets, the November crude contract in New York, which expired Tuesday, gained 10 cents to US$82.81 a barrel. The December contract ran up 58 cents to US$82.49.

December gold rose $7 to $1,251.70 an ounce while December copper was ahead four cents to US$3.03 a pound.

It is a key week for the Canadian currency as the Bank of Canada delivers its next interest rate statement on Wednesday along with its latest monetary policy report containing its latest estimates for growth and inflation.

Canada's central bank is expected to leave its key rate unchanged at one per cent, where it has been for over four years. Traders will focus on the morning news conference by Bank of Canada governor Stephen Poloz.

Also on Wednesday, Statistics Canada delivers the August read on retail sales.