News

Loonie takes further gains a day after Fed's latest announcement

TORONTO – The Canadian dollar moved higher against the U.S. greenback mid-session Thursday as the Fed’s stimulus announcement continued to reverberate through markets.

The loonie rose 0.02 of a cent to 101.57 cents US following the latest round of monetary easing that was announced Wednesday afternoon.

The Fed’s latest stimulus program involves spending US$45 billion a month on Treasurys, which would complement an existing program where the Fed buys mortgage-backed securities to the tune of $40 billion a month.

The central bank has launched three rounds of quantitative easing since the financial crisis hit in 2008 and they have been widely credited with strengthening financial markets.

The announcement had pushed the U.S. dollar to new eight-week lows on Wednesday.

In commodities, the February gold bullion contract dropped $16.90 to US$1,701.00 an ounce.

Crude oil prices for January rose 17 cents to US$86.94 a barrel on the New York Mercantile Exchange.

Meanwhile, copper prices also fell, with the March contract on the Nymex dropping four cents to US$3.68 a pound.

In U.S. economic data, the Commerce Department said Americans spent more on autos, electronics and building supplies in November, pushing retail sales up 0.3 per cent in last month. That offset a 0.3 per cent decline in October.

And the U.S. Labour Department said fewer Americans applied for unemployment benefits last week, the fourth straight weekly decline. The seasonally adjusted figure of 343,000 was the lowest level in two months and the second-lowest total this year.