Canadian dollar rallies as air of calm returns to financial markets

TORONTO: The Canadian dollar rebounded against the greenback on Monday as data showed Canada’s current account balance remaining in surplus and investors waited for more details to assess the severity of the Omicron coronavirus variant on the world economy.

The loonie was trading 0.4% higher at 1.2738 to the greenback, or 78.51 US cents, after trading in a range of 1.2720 to 1.2792. On Friday, it touched its weakest intraday level in more than two months at 1.2799.

“The improvement in risk appetite” has bolstered the Canadian dollar, Benjamin Reitzes, Canadian rates & macro strategist at BMO Capital Markets, said in a note.

Stocks and the price of oil, one of Canada’s major exports, rallied after they were battered on Friday when some countries introduced restrictions for fear the new variant could resist vaccinations and derail economic recovery. US crude prices climbed 6.9% to $72.83 a barrel.

Two cases of the variant have been confirmed in Canada, provincial health officials said on Sunday.