The Canadian dollar closed higher Thursday after the latest trade figures showed Canada’s merchandise trade deficit narrowed in January.The currency rose 0.19 of a cent to 97.14 cents (U.S.) as Statistics Canada said the trade deficit with the world narrowed to $237-million (Canadian) in January from $332-million in December.
Exports rose 2.1 per cent to $39.1-billion while imports decreased 1.9 per cent to $39.3-billion.
Meanwhile, the U.S. trade deficit widened in January, reflecting a big jump in oil imports and a drop in exports.
The U.S. Commerce Department says the deficit rose to $44.4-billion (U.S.), an increase of 16.5 per cent from December. U.S. exports dropped 1.2 per cent to $184.5-billion while imports rose 1.8 per cent to $228.9-billion as oil imports surged 12.3 per cent.
Even with the wider U.S. trade deficit in January, economists say they think it will narrow slightly this year, in part because of continued gains in U.S. energy exports.
Commodity prices were higher with the April crude contract on the New York Mercantile Exchange up $1.13 to $91.56 a barrel.
May copper rose 3 cents to $3.52 a pound while April bullion added 20 cents to $1,575.10 an ounce.
Traders also looked ahead to Friday’s release of Canadian employment creation figures for February, with economists predicting that 7,500 jobs were created last month.
The U.S. non-farm payrolls report for February also comes out Friday. Expectations for job creation were ratcheted up after payroll firm ADP said Wednesday that the private sector created 198,000 jobs last month.
Optimism rose further Thursday after the Labour Department said the number of Americans seeking unemployment aid fell by 7,000 last week, driving the four-week average to the lowest point in five years.
Overseas, the European Central Bank left its benchmark interest rate unchanged at a record low of 0.75 per cent, holding off on further stimulus even though the euro area remains stuck in recession.
And the Bank of England opted against injecting more money into the ailing British economy, which has one foot in a recession.
The bank also kept its main interest rate at the record low of 0.5 per cent.