The Canadian dollar was lower Wednesday, losing some ground after a strong rally amid weak Chinese trade data.
The loonie declined 0.22 of a cent to 91.76 cents US, amid data showing that China’s exports fell 6.6 per cent from a year earlier, well below analysts’ expectations of single-digit growth. Imports contracted by 11.3 per cent.
In a speech Thursday, China’s Premier Li Keqiang said the foundation for growth is “not strong” and the economy still faces “downward pressure.” But he ruled out additional short-term stimulus.
The Canadian dollar jumped 0.42 of a cent Wednesday as the release of the minutes of the last Federal Reserve meeting eased concerns about the pace of interest rate hikes and pushed the greenback lower.
But the loonie has enjoyed a series of sharp runups, advancing about three per cent to a three-month high just since March 20 . Analysts point to a variety of positive factors, including positive readings on gross domestic product, inflation, labour and trade and Monday’s Bank of Canada business outlook survey that confirmed that businesses are increasingly optimistic as the impact of a weak Canadian dollar combines with a U.S. recovery to support growth.