TORONTO - The Canadian dollar was higher Thursday amid a better than expected reading on manufacturing shipments during March.
The loonie advanced 0.06 of a cent to 91.95 cents US as Statistics Canada reported that manufacturing sales edged up 0.4 per cent to $50.9 billion. It was the sixth advance in seven months and was far better than the 0.1 per cent rise that economists had expected.
The agency said that the gain mostly reflected higher sales in the food, machinery, and plastics and rubber products industries. However, these increases were largely offset by declines in the paper, and petroleum and coal products industries.
In the U.S., other data showed that inflation is ticking up from very low levels.
The Labor Department said the consumer price index rose 0.3 per cent last month after a 0.2 per cent gain in March. Over the past 12 months, prices have increased two per cent, the largest gain since July and matching the Federal Reserve’s inflation target.
The gain was largely due to higher food and gas costs.
Traders also considered other data showing the economic recovery in the European Union proceeding at a slower than expected pace.
Eurostat, the EU’s statistics office, said the economy of the 18 countries that share the euro saw economic output grow by only 0.2 per cent in the first quarter from the previous three-month period. The modest rise came despite a better-than-expected 0.8 per cent advance in Germany and was below economists’ expectations for a 0.4 per cent increase.
A large chunk of the blame for the under performance can be placed on a flat performance in France, Europe’s second largest economy behind Germany.
The figures are likely to strengthen arguments for the European Central Bank to cut interest rates and take further stimulus measure at its next meeting June 5.
On the commodity markets, June crude on the New York Mercantile Exchange fell 20 cents to US$102.17 a barrel.
July copper was unchanged at US$3.16 a pound and June bullion dropped $12.30 to US$1,293.60 an ounce.