Canadian dollar climbs after Bernanke remarks

Thursday, July 14, 2011 | 02:28 PM EDT by Andrew VaysThe Canadian dollar gained in strength Wednesday against the U.S. dollar after U.S. Federal Reserve Chair Ben Bernanke suggested additional monetary stimulus might ensue, Reuters reports.
A report released by the U.S. Energy Information Administration stated imports of crude oil, which is natural resource-rich Canada's top commodity, fell by 854,000 barrels per day for week-ended July 8.
"The only headwinds that the Canadian economy is facing are nondomestic in nature," foreign exchange trading head Firas Askari of BMO Capital Markets told the news service. "I think if we see some sort of stabilization on the global scale you are going to see monetary policy shift here and probably shift relatively quickly."
Oil's importance to Canada is enormous as the nation's commerce is based on exporting its natural resources. The U.S. also is vital to Canada as the two nations share a strong trade relationship.
If the economy continues at its weak pace, coupled by lower-moving inflation, additional monetary policy is likely, according to Bernanke. That was interpreted to mean a third round of quantitative easing as the second round wrapped up on the final day of June.
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