Canadian dollars are pictured in Vancouver, B.C. Thursday, Sept. 22, 2011.JONATHAN HAYWARD/The Canadian Press
The Canadian dollar moved higher Monday amid lower oil prices and continued market uncertainty over the European debt crisis.
The loonie was up 0.1 of a cent from Thursday's close to 98.36 cents (U.S.). Canadian banks and the bond market were closed Friday for Remembrance Day.
There was relief on markets as Italian premier-designate Mario Monti, a highly-respected economist, took over from Silvio Berlusconi, who had lost the confidence of financial markets amid worries that Italy might have to default on its $1.9-trillion (CAN) debt.
"Markets are favourable to his new role as it is believed he will have more success combining austerity with growth and be more open to outside monitoring," observed Scotia Capital chief currency strategist Camilla Sutton.
But on Monday, buyers pushed Italy's key 10-year borrowing rate to 6.4 per cent, down from last week's worrying highs above seven per cent but still more than three times what Germany pays to borrow.
And in a sale of five-year bonds where Italy easily raised $3-billion (CAN), investors demanded an interest rate of 6.29 per cent for the bonds, the highest level since 1997, compared with 5.32 per cent at a similar auction a month ago.
Italy is dealing with a huge public debt which is stuck near 120 per cent of GDP.
Improving market confidence in Italy is crucial to the future of the eurozone as the country would be too expensive to rescue.
Commodity prices were mixed with the December crude contract on the New York Mercantile Exchange down 75 cents to $98.24 (U.S.) a barrel.
Bullion prices also slipped with the December contract on the Nymex down $6.30 to $1,781.80 (U.S.) an ounce.
But copper prices advanced as the December contract gained six cents to $3.52 (U.S.) a pound.