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Loonie softens after Fed member's comment Add to ...

The Canadian dollar moved lower Tuesday on a new round of concern about the global economy.

The loonie closed at $1.0198 (U.S.), off 0.19 of a cent after comments made by a member of the U.S. Federal Reserve sent investors back to the perceived safe haven of the U.S. dollar.

Bank of Philadelphia president Charles Plosser questioned the Fed’s latest round of stimulus, suggesting in a speech that it wouldn’t help the economy grow.

In commodities, November crude on the New York Mercantile Exchange moved down 56 cents to close at $91.37 a barrel. The TSX energy sector lost 1.4 per cent.

December bullion increased $1.80 to $1,766.40 an ounce. December copper gained 2.7 cents to $3.76 a pound.

A batch of economic data had earlier inspired some confidence in the U.S. economy in particular.

The Conference Board said its consumer confidence index rose to 70.3, up from 61.3 in August, and it’s the highest reading since February.

And the Standard & Poor’s/Case Shiller index report showed that U.S. home prices increased 1.2 per cent nationally in July compared with the same month last year. Prices also rose in July from June in all 20 cities tracked by the report. It’s the third straight month in which prices rose in every city.

Meanwhile, Statistics Canada said retail sales rose 0.7 per cent to $39-billion (Canadian) in July, more than offsetting a decline in June. The increase was largely weighted in higher sales of cars, trucks and auto parts, as well as general merchandise.

“Today’s positive retail data follow a string of earlier negative readings for July, including poor wholesale, factory shipments and international trade numbers,” said CIBC World Markets economist Emanuella Enenajor in a note.

“Taken together, today’s data still pegs July’s GDP at roughly flat.”

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