The Canadian dollar closed little changed Friday as data showed the Canadian economy contracted in June while uncertainty over whether Syria will be hit with a U.S.-led punitive military strike pushed the greenback higher against most currencies.
The loonie edged up 0.01 of a cent to 94.97 cents (U.S.) as Statistics Canada reported that gross domestic product in June shrank by 0.5 per cent, which was in line with economists’ expectations.
At the same time, GDP grew at an annualized rate of 1.7 per cent, higher than the 1.6-per-cent pace that was forecast.
Economists had expected the economy would hit a rough patch in June, largely because of severe flooding in Alberta and a construction sector strike in Quebec.
First-quarter growth was revised downward to 2.2 per cent from 2.5 per cent.
The data came out a day after U.S. data showed the American economy grew at a better-than-expected pace of 2.5 per cent in the second quarter. It was originally thought the economy only grew by 1.7 per cent.
Markets have been rattled this week by the prospect of a strike against Syria after an alleged chemical weapons attack.
The U.S. government said it has “high confidence” that Syria’s government carried out the attack Aug. 21, killing 1,429 people, including at least 426 children.
The UN has said their inspectors will wrap up their investigation Friday. Some of their experts will be travelling to laboratories in Europe to deliver the material they’ve collected this week in the Damascus suburbs purportedly hit by toxic gas.
Secretary of State John Kerry noted that UN investigators probing the chemical weapons attack are limited by a mandate to determine if an attack took place. He says they won’t say who is responsible.
In a surprise move, the British parliament voted late Thursday against military action in Syria, whittling down the core of the planned coalition.
Commodities also pressured the loonie as easing concerns about international intervention in Syria pushed oil prices lower for a second day after rising 4 per cent on Tuesday and Wednesday.
The October crude contract on the New York Mercantile Exchange lost $1.15 to $107.65 a barrel.
Syria is not a major oil producer but a widening conflict there could affect major producers in the region or disrupt supply routes.
Gold prices also moved lower after spiking earlier in the week and the December bullion contract on the Nymex fell $16.80 to $1,396.10 an ounce.
December copper stepped back 3 cents to $3.23 a pound.