By Commodity News Service Canada
Winnipeg, August 26 – The Canadian dollar was higher on Tuesday as traders considered a major Canadian corporate deal in the making and looked ahead to key data out at the end of the week.
At 9:10 CDT Tuesday morning, the loonie rose 0.14 of a cent to US$0.9121 or US$1 = C$1.0980.
Burger King announced that it is buying Tim Hortons in a cash and stock deal worth approximately US$11 billion. The deal will create the world’s third-largest fast food restaurant company.
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The deal will see that the parent firm, 3G Capital, own 51 per cent of the new entity.
Depending on the structure of the deal, it could have an impact on the Canadian dollar as large corporate deals in the past have pushed the loonie higher. This is because a foreign buyer acquiring a Canadian company will need Canadian currency to close the deal, which will boost demand for the loonie on financial markets, traders say.
Traders are also looking ahead to Friday, when Statistics Canada releases its June reading on gross domestic product growth. Economists expect the agency will report that GDP grew by 0.2 per cent in June, which would translate to an annualized growth of 2.6 per cent.
In the U.S., durable goods orders for July jumped 22.6 per cent, reflecting a huge jump in orders at aircraft giant Boeing. Orders actually declined 0.8 per cent, excluding transportation.
At 9:10 CDT Tuesday morning, the Toronto Stock Exchange was up 47.16 points to 15,645.90.
