Canadian Dollar Holds Onto Early Gains

The Canadian dollar was trading at a sharply higherlevel against its U.S. counterpart at midday on Wednesday. The Canadian dollar held on to its early advances as the improved marketsentiment that lifted the currency in early activity showed no signs of fading,analysts said.

There is cautious optimism that the global economic slowdown is running out ofsteam, which is helping to ease risk aversion, they said. Commodity-sensitive currencies, including the Canadian dollar, were alsounderpinned Wednesday by strength in crude oil futures, which at middaycontinued to trade about US$50 a barrel.

Technically-based buying interest and suggestions that the Canadian dollar hasfurther upside potential further helped to lift the Canadian currency, traderssaid. In domestic news, Statistics Canada reported Wednesday that non-farm payrollemployment fell by 79,600 in February, down 0.5% from a month earlier.

Thelargest declines were seen in the manufacturing sector. At 12:58 p.m. EDT, the Canadian dollar was trading at 83.24 U.S. cents orUS$1=C$1.2013, which compares with 83.22 U.S. cents or US$1=C$1.2016 earlier inthe day and Tuesday's North American close of 81.93 U.S. cents or US$1=C$1.2205.

At midday on Wednesday the Toronto Stock Exchange was higher, up 73.4 pointsat 12:58 p.m. EDT to sit at 9,421.4.