By TraderVox.com
Tradervox.com (Dublin) – The loonie advanced against dollar from an almost three-month low as the manufacturing index unexpectedly gained in the US. The Canadian dollar gained against most of its counterparts as a private report from the US showed that companies added more workers than it was forecast. The increased risk appetite has boosted the loonie after it had fallen prior to data projected to show that Canadian job growth slowed while the US unemployment rate increased. The Canadian dollar is expected to close the week just above parity after the reports are released today.
Eimer Daly, a currency analyst in London at Monex Europe Ltd has indicated that the positive US manufacturing data has pushed the Canadian dollar high against the greenback. She noted that the majority of the Canadian exports are to the US, hence good performance for in the US is a positive for the loonie. The loonie has strengthened beyond its 200-day moving average of 99.94 cents against the US dollar. It had breached this level of October 30, to touch its 100-day moving average of 99.68. The Canadian dollar had dropped below its 50-day moving average on October 18. Moving averages are levels used by some Forex traders, where they are construed as turning points in the direction of a security price.
The loonie pared losses after the company-hiring and US manufacturing PMI reports were issued. The ISM factory index rose from 51.5 in September to 51.7 last most. Most economists were projecting a decline to 51. A report by ADP Research Institute of Roseland showed that US companies employed 158,000 Americans in October, after adding 114,000 in September. The market was expecting a lower figure of 131,000.
The Canadian dollar advanced by 0.3 percent against the dollar to trade at 99.65 at the close of trading yesterday in Toronto. It had earlier declined by 0.2 percent to trade at $1.0013, which kept it under parity for the fourth day.
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