TORONTO — The Canadian dollar lost early momentum and drifted slightly lower Monday amid rising oil and gold prices.
The loonie was down 0.15 of a cent to 101 cents US as the U.S. currency strengthened late in the morning.
The dollar had earlier run up as high as 101.72 cents US as appetite for risk improved following a tough week on equity markets last week. Major North American indexes tumbled about four per cent on worries about the health of the U.S. and global economies and worries about levels of European bank funding without a lasting solution for Europe’s debt troubles.
But investors are nervous as they look ahead to Friday and a key speech by Fed chairman Ben Bernanke.
The Fed pledged earlier this month to keep interest rates at ultra-low levels through mid-2013. Investors wonder whether Bernanke will announce, or at least preview, further steps to help the economy — including a third round of bond purchases known as quantitative easing.
Investors looking for safety continued to send bullion higher with the December gold contract on the New York Mercantile Exchange up $39.70 to a record close of US$1,891.90 an ounce.
Oil prices recovered somewhat from a 3.6 per cent slide last week while economic worries sent gold further into record territory.
The September crude contract on the New York Mercantile Exchange, which expired Monday, gained $1.86 to US$84.12 a barrel while October crude gained $2.01 to US$84.42 a barrel. However, Brent crude prices fell as Libyan rebels captured most of the country’s capital, boosting hopes the OPEC nation’s oil exports could resume soon. The October contract declined $1.50 to US$107.12 a barrel late in the North American trading day.
Brent has been at an unusual premium to the U.S. crude futures contract for months, in large part due to the fact that Europe relies more than the U.S. on oil from Africa, including Libyan imports.
The September copper contract gave up early gains and moved down three cents at US$3.96 a pound.
Meanwhile, investors will also be looking towards important economic data this week to gauge the health of the economy.
U.S. durable goods orders data for July are out Wednesday and economists expect they rose by 2.2 per cent from the previous month thanks to a rebound in aircraft orders at aerospace giant Boeing and strong motor vehicle sales.
Traders will also take in Canadian retail sales data on Tuesday. It is expected sales were up by 0.6 per cent.