TORONTO – The Canadian dollar hit fresh, multi-year lows Friday as November’s economic data came in worse than expected.
The loonie finished well off early lows but still down 0.63 of a cent to 78.67 cents US as gross domestic product in November declined 0.2 per cent, worse than the flat showing that economists had expected. The currency had gone as low as 78.14 cents US, its lowest level since mid-March 2009.
Statistics Canada said the one-month drop between October and November extended across major sectors including manufacturing and mining, quarrying and oil and gas extraction.
Canadian GDP had risen 0.3 per cent in October, starting Canada’s fourth quarter on a positive note, but since then there’s been a major decline in the price of oil that is expected to have a major negative impact on the economy. Statistics Canada issues its fourth-quarter GDP reading March 3.
Other data out Friday showed the American economy also slowing at the end of last year. Growth in the fourth quarter missed expectations, with U.S. GDP for the period coming in at 2.6 per cent, down sharply from a five per cent rise in the third quarter. Economists had generally expected a reading of 3.1 per cent.
On the commodity markets, March crude climbed $3.71 to US$48.24 a barrel.
March copper climbed four cents to US$2.49 a pound while April gold bullion gained $23.30 to US$1,279.20 an ounce.
The Canadian dollar has had another tough week, down almost two cents amid sliding prices for oil, copper and gold and increasing speculation that the Bank of Canada will follow up last week’s surprise quarter-point reduction with another cut in the near future.
The currency has lost about 7 1/2 cents this month.