TORONTO – The Canadian dollar was lower Friday amid a bigger than expected slide in Canadian manufacturing shipments and positive Chinese economic data.
The loonie was down 0.12 of a cent at 101.42 cents US after Statistics Canada reported that manufacturing sales declined 1.4 per cent in October to $48.8 billion. Economists had expected a dip of 0.2 per cent.
The agency said the slide reflected drops in the aerospace product and parts, motor vehicle assembly and primary metal industries. These declines were partly offset by higher sales in petroleum and coal products as well as the wood product industries.
Commodities had advanced earlier in the morning after HSBC Corp. released its preliminary China Purchasing Managers’ Index for December, which showed greater expansion in the manufacturing sector of the world’s second-biggest economy. The index rose to 50.9 from November’s 50.5.
China has a huge appetite for commodities, which has sent prices higher for oil and metals in the past, along with the energy and mining stocks on the TSX.
The January crude contract on the New York Mercantile Exchange gained 58 cents to US$86.47 a barrel.
March copper was up a cent to US$3.67 a pound while February gold bullion dipped 50 cents to US$1,696.30 an ounce.
Investors also kept a close eye on budget talks in Washington between President Barack Obama and key Republican lawmakers aimed at averting a fiscal crisis at the end of the year.
A deal must be reached to avoid going over the so-called “fiscal cliff,” which would involve the automatic imposition of hundreds of billions of dollars in spending cuts and tax increases that could plunge the world’s largest economy back into recession, and depress other economies around the world.