Canadian dollar slightly higher amid eurozone concerns, positive U.S. data

TORONTO – The Canadian dollar closed Wednesday as traders focused on Greece and the continued inability of eurozone finance ministers to agree on getting the next batch of desperately needed bailout money to that country.

The loonie was up 0.08 of a cent at 100.35 cents US as traders also took in some positive American economic data.

European Union finance ministers ended a marathon, 12-hour session Tuesday still unable to agree on a deal to give Greece the next instalment of bailout money. It was the second consecutive meeting at which ministers couldn’t agree on a deal.

There has been disagreement among the ministers and the IMF, which gives bailout loans alongside the eurozone. The eurozone ministers are in favour of giving Greece an extra two years, to 2022, to bring its debt down to 120 per cent of gross domestic product from the 176 per cent forecast for this year. The IMF has resisted such an extension.

The eurozone finance ministers will try again on Monday to finally clinch an agreement on how to help Greece, which has been relying on international bailout loans since 2010.

But analysts said expectations were not high.

“There is increased hope that a compromise will be reached on Monday, though disappointment has generally been the name of the game with these special meetings,” observed a commentary from RBC Dominion Securities.

Oil prices moved higher as traders considered whether a bus explosion in Tel Aviv had the potential to seriously complicate efforts to arrange a ceasefire between Israel and the Islamic militant group Hamas. The January crude contract on the New York Mercantile Exchange gained 63 cents to US$87.38 a barrel.

December copper edged two cents lower to US$3.50 a pound while December gold bullion gained $4.60 to US$1,728.20 an ounce.

On the economic front, the U.S. Labor Department said jobless benefit applications fell 41,000 to 410,000 last week. But it also cautioned that the data is still distorted by superstorm Sandy.

Also, the Conference Board said its index of leading indicators, a gauge of future economic performance, increased 0.2 per cent in October after a 0.5 per cent gain in September.

And the latest reading of the University of Michigan’s consumer confidence index showed it inching up in November to the best reading in over five years because of rising optimism about the jobs markets.

The index gained slightly to a reading of 82.7, off from the original estimation of 84.9.