The Canadian dollar closed at 75.65 cents (U.S.), up an impressive 0.59 cents (U.S.) from Wednesday's close of 75.06 cents (U.S.).
The main driver of the Canadian dollar was the price of oil. West Texas Intermediate (WTI) crude soared up 10 per cent, or $3.96 on Thursday, to close at $42.56 (U.S.). The biggest one day gain since March 2009.
Oil was boosted after news of a big upward revision of second-quarter GDP in the U.S. The report revealed the economy there grew by 3.7 per cent from April to June. Economists were expecting 2.3 per cent.
The news also sent North American markets soaring. The Toronto Stock Exchange closed up 384 points, or almost 3 per cent higher. The Dow Jones Industrial Average also closed up 355 points. Markets were also supported higher after China's main market closed up 5 per cent on Thursday.
Looking ahead, analysts are now predicting the U.S. Federal Reserve will wait until October to hike rates, despite the better-than-expected economic data coming out of the U.S., indicating the economy could handle a modest hike. This is good news for the loonie as a rate hike could bring the dollar back down below 75 cents (U.S.).
There is no major economic news for Canada on Friday, but there is medium tier data from the U.S. with personal consumption expenditures and pending home sales both being released at 8:30am and 10:00am ET on Friday. Thursday is the first of the three day Jackson Hole Economic Policy Symposium, which is sponsored by the Federal Reserve Bank of Kansas City. This meeting could reveal further what to expect from the U.S. Federal reserve regarding rates, as it often sets the agenda for the Fed for the rest of the year.
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