Loonie shifts higher after trade deficit shrinks in Canada, even more in U.S.

TORONTO – The Canadian dollar moved slightly higher on Tuesday morning after a report showed the country’s trade deficit shrank for June.

The loonie was up 0.13 of a cent to 96.38 cents US early Tuesday before stock markets opened.

Statistics Canada said the trade deficit was $469 million in June, a decline from a revised $781 million deficit a month earlier.

Meanwhile, south of the border, the U.S. trade deficit narrowed sharply in June to its lowest level in more than 3 1/2 years. Exports rose to all-time high and imports declined, signs that economic growth is stronger than previously thought.

The Commerce Department says the June deficit fell 22.4 per cent to $34.2 billion. That’s the lowest since October 2009 and down from May’s imbalance of $44.1 billion, which was revised down.

In commodities, December gold pulled back $14.80 to US$1,287.60 an ounce.

The September crude contract on the New York Mercantile Exchange moved up 34 cents to US$106.90 a barrel.