By Commodity News Service Canada
Winnipeg, March 1 – The Canadian dollar was stronger on Friday, moving up against the US dollar as increased demand for the domestic currency countered a number of bearish influences overhanging the market.
The Canadian currency late in the afternoon was quoted at US$0.9736, or US$1=C$1.0271. This compares with Thursday’s North American close of US$0.9696, or US$=C$1.0314.
The relative strength in the Canadian dollar was tied to Canadian shareholders cashing in on the US dollars they were paid after the takeover of Nexen Inc., according to analysts.
The strength came despite the softer-than-expected GDP data released by Statistics Canada Friday morning.
US economic uncertainty was also overhanging the currency markets. US politicians were unable to reach an agreement ahead of a deadline today which will see US$85 billion in automatic budget cuts. The so-called sequester is expected to weigh on the US economy, according to analysts.
Canadian bonds were stronger on Friday, as concerns over the US sequester had investors focused on reducing their risk exposure.
