Canadian Dollar Gains as Euro-Area Report Shows Deeper Recession

The Canadian dollar gained the most versus the euro since the beginning of the year after a report showed Europe’s recession deepened more than economists forecast last quarter, sapping demand for the region’s assets.

The currency approached parity against the U.S. dollar ahead of a two-day meeting between Group-of-20 finance ministers and central bankers scheduled to start tomorrow in Moscow. It rose against the greenback for a third day after a report showed weekly U.S. jobless claims fell more than forecast.

“The Canadian dollar has done fairly well, especially against the euro,” Blake Jespersen, managing director of foreign exchange at Bank of Montreal, said in a telephone interview. “Generally speaking, people are somewhat optimistic about global growth this year, especially in some of the emerging market and commodity economies, so you’re seeing a boost from that.”

Canada’s currency, nicknamed the loonie for the image of the aquatic bird on the C$1 coin, rose 0.1 percent to $1.010 per U.S. dollar at 8:49 a.m. in Toronto. The loonie gained as much as 1 percent versus the euro, its biggest intraday increase since Jan. 2. One Canadian dollar purchases 99.87 U.S. cents.

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