Loonie lower as key commodity prices pull back; weak economic data

TORONTO – The Canadian dollar ended lower on Thursday as key commodities dipped alongside further discouraging figures on the global economy, in particular from Asia and Europe.

The loonie fell 0.21 of a cent to 102.41 cents US, as traders flocked to the safe haven of the U.S. dollar.

“In speaking with other market participants it appears as though the greedy have become the needy as those looking for continued Canadian dollar strength missed the abrupt turnaround in U.S.-Canadian dollar and are now raising U.S. dollar buy orders daily,” wrote John Curran, senior vice- president of CanadianForex in a note.

Among the sobering news for investors was a survey pointing to a deepening recession in Europe, figures from Japan that showed the country’s powerhouse export sector was continuing to suffer and a private survey of manufacturers in China that showed activity fell again in September, though at a slightly slower pace than August.

In the U.S., the number of Americans seeking unemployment benefits fell only slightly last week, suggesting that the hiring level remains weak. The Labor Department said Thursday that applications declined by 3,000 from the previous week, to a seasonally-adjusted 382,000.

Key commodities weakened on the discouraging global data.

The October contract for crude fell 11 cents to US$91.87 a barrel on the New York Mercantile Exchange. The November contract, which traded in higher volume, gained 12 cents to $92.42.

Copper slid 5.5 cents to US$3.76 a pound while gold bullion fell $1.50 to end the session at US$1,770.20 an ounce. Prices for soybeans, platinum and palladium also dropped.