TORONTO - The Canadian dollar closed higher Friday amid strong manufacturing data for September.
The loonie was up 0.19 of a cent to 95.72 cents US as Statistics Canada reported that manufacturing shipments rose 0.6 per cent to $49.9 billion in September. Economists had expected they'd rise about 0.5 per cent.
The gain was the fourth increase in five months and largely a result of higher sales in the motor vehicle assembly and food industries. Total sales in September were at their highest level since June 2012.
There was a muted response to a sweeping economic reform plan from the Chinese government and confidence that the U.S. Federal Reserve likely won't be cutting stimulus as early as thought.
In a report issued after a closely watched Communist party conference, China’s ruling party pledged to ease barriers to private competitors in markets controlled by state companies. At the same time, they reaffirmed that government-owned industry is the core of the economy.
It left out many details of what role private or foreign competitors might be allowed in government-controlled industries such as energy, telecoms and finance. But it outlined changes clearly intended to make industries more efficient and productive by injecting more competition.
Chinese leaders are under pressure to replace an economic model based on exports and investment that delivered three decades of rapid growth but has run out of steam.
Meanwhile, the woman most likely to succeed Ben Bernanke at the helm of the Fed made clear that she’s prepared to continue the central bank’s low interest rate policies to keep the U.S. economic recovery on track.
During a confirmation hearing before the Senate banking committee, Janet Yellen warned critics that any potential harm those policies pose are outweighed by the risk of leaving a still-weak economy to survive without them.
Her statements convinced markets that the central bank won’t reduce its $85 billion of monthly bond purchases until at least March.
There was little movement on commodity markets in response to the Chinese announcement as December crude edged up eight cents to US$93.84 a barrel.
December copper was up a penny at US$3.17 a pound while December gold bullion gained $1.10 to US$1,287.50 an ounce.