Canadian currency nears parity with US dollar, markets hit new high

Canadian markets Friday crossed the 12,000-mark and the Canadian dollar reached record levels against the US for the first time since mid-2008.

Canadian markets Friday crossed the 12,000-mark and the Canadian dollar reached record levels against the US for the first time since mid-2008.

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While the markets made small gains on metal prices to cross the 12,000-mark for the first time since September 2008, the Canadian dollar - or the loonie - surged to 98.20 cents US to reach its highest level against the US currency since July 2008.

The Toronto Stock Exchange - the world's biggest energy and mineral market - has been gaining in recent weeks on rising metal and oil prices. The market crossed the psychologically important mark Friday on higher employment figures for February and surge in Potash Corporation shares by $8.30 to $128 on higher earnings.

In its report, Statistics Canada said the economy created new 20,900 new jobs last month, bringing the unemployment rate down to 8.2 percent.

The Canadian currency too was pushed up by oil and metal prices even as the US dollar dipped Friday on reports that Janet Yellen, a known financial dove who heads the San Francisco Federal Reserve Bank, may be the next vice-chairman of the Fed.

Analysts here said her elevation to the Fed could significantly impact monetary policy and thus market direction. Known as a comparative dove in the US financial world, Yellen's elevation to the Fed may be negative for the greenback, according to the analysts.

The Canadian dollar had hit the historic high of 1.10 cents US against the greenback in November 2007. Then it had sunk to 77 cents US last year as the global crisis deepened.

But Canadian markets are still way off the historic high of 15,000 points reached in June 2008.