The Canadian dollar strengthened to a six-week high against its US counterpart on Tuesday after data showed a rebound in the country's exports one day before an interest rate decision by the Bank of Canada. Canada's trade deficit narrowed to C$1.47 billion in October from a revised C$3.36 billion in September as exports increased after four consecutive monthly declines. Economists had forecast a deficit of C$2.70 billion.
"This report, combined with last week's stellar employment report, will be looked favorably upon by the data dependent Bank of Canada," said Dina Ignjatovic, an economist at TD Bank in a research note. Data on Friday showed that Canada's economy added nearly 80,000 jobs in November. The central bank raised rates in July and September for the first time in seven years. At 9:36 a.m. ET (1436 GMT), the Canadian dollar was trading at C$1.2661 to the greenback, or 78.98 US cents, up 0.1 percent. The currency touched its strongest since October 24 at C$1.2624.
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