The Canadian dollar closed above parity Friday for the first time in almost 31 years, as the U.S. greenback continued its dramatic fall against major world currencies.
According to Bank of Canada data, the loonie closed at $1.0052 US, up two-thirds of a cent from Thursday's close.
Expressed another way, it means that a U.S. dollar is now worth a little less than 99.5 cents in Canadian money.
The loonie had reached parity with the U.S. currency on Sept. 20 — the first time since November 1976 — but had failed to close at or above that level.
The loonie's rise came in spite of a weaker-than-expected GDP reading for July. Statistics Canada said the economy grew by 0.2 per cent that month, while economists were forecasting growth of 0.3 to 0.4 per cent.
Higher gold prices also lent support to the dollar, analysts said. Gold futures jumped more than $10 US an ounce to above $750 US an ounce, a new 27-year high.
Gold's rise was due in large part to the weakness of the U.S. greenback, as investors jumped into bullion as an alternative to assets denominated in U.S. dollars.
In Friday trading, the greenback fell to another record low against the euro for the seventh consecutive day. Traders are expecting the U.S. Federal Reserve will cut lending rates further to help ward off a recession.
That expectation got a boost from the release Friday of core inflation figures that showed inflation running at its lowest level in almost four years.
Bloomberg reported that the Canadian dollar rose 6.2 per cent against the greenback in September — its biggest monthly rise since the financial data provider began tracking the data in early 1971.
Since the start of the year, the loonie has gained 17 per cent against the U.S. dollar — more than any other major currency. The euro, for instance, has risen seven per cent against the greenback year-to-date, while the British pound and Japanese yen are both up about three per cent.
