By Commodity News Service Canada
WINNIPEG, January 16 – The Canadian dollar closed weaker compared to its US counterpart on Wednesday, as disappointing news from the World Bank had traders selling riskier assets, including the loonie.
The World Bank estimated in a report that the global economy will expand by 2.4% in 2013, which is lower than their June estimate of a 3% expansion.
The Canadian currency was quoted at US$1.0141, or US$1=C$0.9861 at the close on Wednesday, which compares with Tuesday’s North American close of US$1.0162, or US$=C$0.9841.
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A report from the US Federal Reserve on Wednesday saying that hiring in the US has slowed due to fiscal cliff concerns also weighed on the Canadian currency.
Declining metal prices, including gold and copper, also undermined the value of the Canadian dollar.
There was no significant Canadian economic data moving the loonie on Wednesday. Traders were looking ahead to Thursday, when Canadian international transactions data will be released.
Canadian bonds moved higher on Wednesday, supported by US inflation data that will probably mean the Federal Reserve’s bond-buying program will remain unchanged.
The two-year bond yielded 1.172% late Wednesday, from 1.183% on Tuesday. The 10-year bond yielded 1.894%, from 1.909% Wednesday. Bond yields fall as their prices rise.
