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Loonie closes at highest level since late 2007

The Canadian dollar closed higher against the greenback Wednesday amid volatile commodity prices.

The loonie was well off early highs, but up 0.29 of a cent at 103.23 cents U.S., its highest close since mid-November 2007.

The dollar has strongly benefited from oil prices, which have surged amid fighting between supporters and opponents of Libyan leader Moammar Gadhafi. Oil has surged about 17 per cent since Feb. 18.

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Crude prices eased late Wednesday morning with the April contract on the New York Mercantile Exchange down 64 cents at $104.38 (U.S.) a barrel after earlier going almost as high as $106.

Oil prices eased for a second day amid moves by OPEC members to raise output to compensate for lost production in Libya. Under normal circumstances, Libya produces almost two per cent of the world's supply.

Investors are particularly worried that the violent rebellion against Libyan leader Moammar Gadhafi may spread to other producers in the region, especially Saudi Arabia.

Prices were also held in check by data showing a bigger than expected drawdown in American crude inventories last week.

Other commodities were mixed with the April gold contract on the New York Mercantile Exchange up $2.40 at $1,429.60 an ounce.

Copper prices continued to retreat on worries that higher energy costs will slow the global economy and reduce demand for industrial metals, with the May contract in New York down 13 cents at $4.21 a pound. Copper prices are down almost six per cent since Feb. 18.

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