By Commodity News Service Canada
Winnipeg, August 28 – The Canadian dollar was higher Thursday as Canada’s current account deficit improved slightly during the second quarter, analysts say.
At 9:15 CDT Thursday morning, the loonie rose 0.1 of a cent to US$0.9222 or US$1 = C$1.0891 as Statistics Canada reported that deficit edged down C$200 million to C$11.9 billion.
The decline was an indication that the deficit on trade in goods and services had increased, which was more than offset by a lower investment deficit.
Meanwhile, other data showed the U.S. economy grew more than expected during the second quarter. The latest revision shows gross domestic product grew by 4.2 per cent, versus the original reading of four per cent. Economists had generally expected a decrease of 3.8 per cent.
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The showing was a huge improvement from the first quarter, which saw GDP contract 2.1 per cent, mostly due to severe winter weather.
Statistic Canada’s June reading on GDP is expected to be released this Friday. Economists are expecting that GDP grew by an annualized 0.2 per cent in June, which would translate into annualized growth of 2.6 per cent.
Traders are also looking ahead to next Wednesday, when the Bank of Canada will release its next decision on interest rates.
At 9:15 CDT Thursday, the Toronto Stock Exchange was 45.65 cents lower to 15,557.00.
