Loonie closes lower, traders look to economic growth data later in the week

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TORONTO – The Canadian dollar closed lower Wednesday, giving up early strength as commodity prices weakened.

The loonie was down 0.12 of a cent at 91.95 cents US.

On the commodity markets, July crude oil in New York fell $1.39 to US$102.72 a barrel.

June gold was off $6.20 at a fresh three-month low of US$1,259.30 an ounce.

Bullion had closed Tuesday at its lowest level since early February amid an easing of concerns about Ukraine. Worries about higher inflation had also supported gold prices, but now economists are, if anything, more worried about deflation, particularly in Europe.

July copper was unchanged at US$3.18 a pound.

The pace for economic releases picks up later in the week.

Traders are particularly interested in seeing how the Canadian economy performed in the first three months of the year. Statistics Canada releases gross domestic product data for March and the first quarter on Friday. Economists are looking for an annualized rise of 1.7 per cent for the quarter and 0.1 per cent for the month.

That data is of particular concern, coming out days before the Bank of Canada releases its next interest rate announcement.

Also, traders will be looking for the latest U.S. data to see if the American economy actually contracted in the first quarter when the first revision to U.S. gross domestic product data is released Thursday. The initial report showed growth coming in at a paltry 0.1 per cent as severe winter weather impacted the economy, but markets are braced for a worse reading.

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