Canadian Dollar Gains as U.S. Economic Growth Beats Forecasts

Canada’s dollar advanced against the majority of its 16 most-traded counterparts after the economy of the U.S., its largest trading partner, grew more than originally forecast in the second quarter.

The Canadian currency traded at almost a four-month high against the U.S. currency as riskier assets advanced after German Chancellor Angela Merkel said she’s convinced that Italy’s “reforms” will help reduce the interest rates that the nation pays for its bonds. Canada’s dollar was also supported as the Federal Reserve said the U.S. economy continued to expand “gradually” in July.

The growth in U.S. gross domestic product “reinforces the view that Canada is likely to be the main beneficiary,” said Sebastien Galy, a senior foreign-exchange strategist at Societe Generale SA in New York. “The foreign-exchange market is running ahead and buying the solid platinum loonie.”

via Bloomberg

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