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The loonie is higher, against the U.S. dollar, than it has been since the start of the year, rising above 94 cents US early Wednesday.

The Canadian dollar this morning hit its highest point of the year, trading above 94 cents US.

Although it has since retreated a little, the loonie hit a high of 94.12 early Thursday morning, its highest level against the U.S. dollar since Dec. 31, when the Canadian dollar entered the new year at 94.14 US.  It closed at 93.75 US, up 0.03 of a cent from Monday.

The loonie's strength comes despite weakness in one of the factors that's been driving the dollar higher of late: The price of oil. The August crude contract was down 45 cents to $104.89 US a barrel in New York early Wednesday.

The Canadian dollar has gained more than three per cent since the start of June, Scotiabank currency analyst Camilla Sutton says, adding that it is just a much a sign of strength in the Canadian economy (as evidenced by a higher than expected inflation figure last month) as it is weakness in the U.S. dollar against everything else.

The Canadian dollar has also been buoyed by conflict in the Middle East pushing oil prices higher. And there could be more gains on the way, at least in the short term, Sutton says.

"Every July over the last five years [the loonie] has undergone substantial strength, with an average monthly gain of 3.2 per cent," Sutton says. "It has also strengthened seven out of the last 10 July’s, with an average monthly gain of 1.4 per cent.The pattern is not predictive but does suggest that there could be underlying reasons why [the Canadian dollar] has tended to rally in July."

The next major catalyst for the loonie is likely the monthly jobs figure out of Statistics Canada that will be released on Friday morning.