News Column

Canadian dollar rises following big dip amid slowdown in Chinese manufacturing

February 20, 2014

By Malcolm Morrison

TORONTO _ The Canadian dollar was slightly higher Thursday morning while commodity prices declined in the wake of disappointing economic data from China.

The loonie added 0.03 of a cent to 90.27 cents US.

HSBC's preliminary version of its monthly China purchasing managers' index fell to a seven-month low of 48.3 from January's 49.5 on a 100-point scale. Numbers below 50 show activity contracting.

China's economic activity has slowed steadily as the government tries to cool an investment boom and encourage more sustainable growth based on domestic consumption.

The March crude contract on the New York Mercantile Exchange dropped 46 cents to US$102.85 a barrel.

March copper was down two cents to US$3.27 a pound while April gold fell $8.20 to US$1,312.20 an ounce.

The dollar had fallen 1.08 cents US on Wednesday after wholesale sales fell 1.4 per cent in December to the lowest level in six months.

Other data underscored how large amounts of snow and freezing temperatures are having an impact on U.S. economic performance.

The Empire State Manufacturing Index for February, a gauge of manufacturing activity in the U.S. Northeast, declined much more than expected while the U.S. National Association of Home Builders' buyer traffic index fell sharply as fewer prospective buyers felt like braving severe winter conditions in many parts of the U.S.

Traders looked ahead to Friday and the latest readings on the consumer price index for January and retail sales for December.

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Source: Canadian Press DataFile

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