03/17/2016 10:38 EDT | Updated 03/18/2017 01:12 EDT

Loonie surges on U.S. dollar weakness, crude nears US$40 a barrel

TORONTO — The Canadian dollar and the price of oil surged in morning trading today.

The loonie briefly traded above 77 cents US for the first time since October and April contracts for West Texas Intermediate crude came within a few cents of US$40 a barrel.

Both were reacting to weakness in the U.S. dollar following the U.S. Federal Reserve's indication that interest rate increases will come slower than anticipated.

As the morning progressed, Canada's dollar gave up some gains to trade at 76.85 cents US, up 0.64 from Wednesday's close.

April crude contracts were at US$39.42 per barrel and had been as high as US$39.64 earlier in the morning.

The resource-heavy Toronto Stock Exchange was also up but the major U.S. indexes were either down or showed smaller gains.

The S&P/TSX composite index was up 75.90 points or about 0.6 per cent at 13,554.03 after nearly an hour of trading.

The Dow Jones industrial average was up 12.36 points at 17,338.12, the broader S&P 500 composite index declined by 2.87 points to 2,024.35 and the Nasdaq composite lost 22.02 points to 4,741.95.

April gold contracts rose $37.10 to US$1,266.40 an ounce, April natural gas was up about one cent to US$1.88 per mmBtu and May copper contracts rose 3.5 cents to US$2.27 a pound.

The Canadian Press