Canadaâ€™s dollar climbed to the strongest since May versus its U.S. counterpart after European Central Bank President Mario Draghiâ€™s comments about preserving the 17-nation currency sparked a rally in higher-risk assets.
The Canadian currency was headed for a 0.4 percent increase against the greenback this week amid gains in stocks and crude oil, the nationâ€™s largest export. Draghi said policy makers will do whatever is needed to preserve the euro.
â€œThe Canadian dollar is reacting to Draghiâ€™s very strong comments,â€ Camilla Sutton, head of currency strategy at Bank of Nova Scotia in Toronto, said in a telephone interview. â€œThereâ€™s a significant short covering in euro. Other markets are following suit on reduced risk aversion.â€ Short covering refers to buying a security to square earlier bets that it would fall.
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