Canadian dollar at three-year high

February 26th, 2011 - 12:26 pm ICT by IANS  

By Gurmukh Singh
Toronto, Feb 26 (IANS) The Canadian dollar Friday rose to its highest level against the US greenback in three years as the Toronto Stock Exchange surged with investors returning after oil prices stabilized on Saudi assurance to rase production.The Canadian currency, which has been above parity against the US dollar, gained 0.47 cents to close at 102.19 cents US. It is the highest level the Canadian dollar - called loonie - has reached against the greenback since November 2007.

Back then, the Canadian dollar - whose fortunes are linked to the nation’s vast oil and gold resources - reached the historic high of 110 cents US as global oil prices began their steep climb in 2007.

At the height of the global economic crisis in March 2009 when oil prices plunged, the loonie had sunk its lowest level of 76.98 cents US for the first time since September 2004.

The composite index on the Toronto Stock Exchange jumped 184.82 points, or 1.3 per cent, to close at 14,052.13 Friday. Financial and energy stocks led the surge on the world’s biggest energy market after days of losses on worries over the Libyan unrest.

As the world is worried over rising oil prices since all previous five recessions followed spike in oil prices, Canada finance minister said he was “overly worried” by oil prices.

Since Canada has the world’s second largest oil reserves, rising oil prices have both positive and negative impacts in Canada, the finance minister was quoted as saying by the Canadian Press.

“We export a lot of oil out of Canada, we consume a lot of oil in Canada as well. The oilsands, the oil industry in Canada is good for the entire country.”

Flaherty added, ” We are watching what is going on in the oil markets. I don’t think there’s reason to have any strong concern about any long-term effects.

“We will have to watch and see whether there’s any interruption, any significant interruption, in supply and if there is whether that interruption of supply is made up by others.”

(Gurmukh Singh can be contacted at gurmukh.s@ians.in)

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