BUSINESS

Canadian dollar rises amid strong manufacturing report, higher commodities

02/13/2015 08:52 EST | Updated 04/15/2015 05:59 EDT
TORONTO - The Canadian dollar closed higher Friday amid a strong reading on manufacturing shipments and rising commodity prices.

The loonie closed up 0.19 of a cent to 80.25 cents US as Statistics Canada reported that manufacturing sales rose 1.7 per cent in December, far higher than the 0.5 per cent reading that economists had expected.

The showing was especially impressive given a 9.3 per cent drop in sales of petroleum and coal products. Excluding the petroleum and coal, manufacturing sales were up 3.2 per cent.

Commodities advanced with March crude up $1.57 to US$52.78 a barrel.

March copper was unchanged at US$2.60 a pound and April gold bullion advanced $6.40 to US$1,227.10 an ounce.

Market sentiment was also lifted Friday by solid economic news from Europe.

Official data show that the German economy grew by 0.7 per cent in the fourth-quarter compared with the previous three-month period, which was much better than the 0.3 per cent rise economists had expected. The figure reported by the Federal Statistical Office on Friday contrasted with an increase of only 0.1 per cent in the third quarter and a decline of 0.1 per cent in the second quarter.

Other data showed that overall economic output across the 18 eurozone countries was 0.3 per cent higher in the quarter. That equates with an annualized rate of around 1.2 per cent, which is still only about half the growth rate in the U.S.

The fourth-quarter performance was nevertheless higher than the 0.2 per cent increased anticipated by investors.

There was also optimism that Greece will come to an agreement with its eurozone creditors.

Greek Prime Minister Alexis Tsipras has agreed to allow government officials to start technical discussions with debt inspectors. The results will inform a meeting of the eurozone's finance ministers Monday.

Tsipras says a "mutually acceptable" deal is possible while German Chancellor Angela Merkel says her country is ready to compromise.