The Canadian Press - ONLINE EDITION

Canadian dollar little changed while May economic growth figures beat forecasts

  • Print

TORONTO - The Canadian dollar closed little changed Thursday as economic growth figures for May came in better than expected.

The loonie was off 0.02 of a cent to 91.71 cents US as Statistics Canada said gross domestic product grew by 0.4 per cent during the month, better than the 0.3 per cent gain that economists had expected.

"While it's just one month, the solid output gain in May is an encouraging sign that the Canadian economy is riding the coattails of a firming U.S. economy," said BMO Capital Markets chief economist Doug Porter.

"Especially encouraging is the broad-based nature of the advance, particularly the decent gains in manufacturing and transportation."

The Canadian report came out a day after other data showed that U.S. gross domestic product grew by an annual pace of four per cent in the second quarter, after contracting 2.1 per cent in the January-March period because of severe winter weather.

The U.S. currency strengthened against other currencies Thursday amid interest rate concerns.

The U.S. Federal Reserve wrapped up its interest rate meeting Wednesday and indicated that it will keep short-term interest rates low "for a considerable time" after it ends its bond purchases, likely in October. Markets have generally expected the Fed to start hiking rates mid-2015, but much stronger than expected economic growth in the second quarter has investors concerned that the Fed could act sooner to raise rates.

Prices for oil and metals also weighed on the commodity-sensitive Canadian currency as the September oil contract moved $2.10 lower to US$98.17 a barrel.

The September copper contract edged a penny lower to US$3.23 a pound while the December gold contract faded $14.10 to US$1,282.80 an ounce.

Markets also awaited developments in the latest Argentine debt saga after the country moved into a debt default for the second time in 13 years.

A midnight Wednesday deadline to reach a deal with holdout bondholders came and went with Argentine Economy Minister Axel Kicillof holding firm to his government’s position that it could not accept a deal with U.S. hedge fund creditors it dismisses as "vultures." Ratings agency Standard & Poor's downgraded Argentina’s foreign currency credit rating to "selective default" because of missed interest payments.

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

Inside peek at Real Pirates, new Manitoba Museum exhibit

View more like this

Photo Store Gallery

  • Marc Gallant / Winnipeg Free Press. Local- Deer in Canola field near Elma, Manitoba. 060706.
  • A goose comes in for a landing Thursday morning through heavy fog on near Hyw 59 just north of Winnipeg - Day 17 Of Joe Bryksa’s 30 day goose challenge - May 24, 2012   (JOE BRYKSA / WINNIPEG FREE PRESS)

View More Gallery Photos

Poll

Are you still on the Bombers' and Jets' bandwagons?

View Results

View Related Story

Ads by Google