TORONTO – The Canadian dollar was little changed Tuesday morning as traders focused on a partial shutdown of the U.S. government and looked ahead to another key deadline looming in the middle of the month.

The loonie was up 0.01 of a cent to 97.07 cents US amid widespread U.S. dollar weakness after Congress failed to approve a short-term funding agreement before a midnight deadline.

Analysts say significant damage to the U.S. economy was unlikely unless the shutdown lasted more than a few days.

More worrisome is the prospect of the U.S. government hitting its debt limit Oct. 17, raising worries of default.

They believe that such an event would likely lead to a flight to safety and, ironically, a stronger U.S. dollar.

Oil prices were lower for second day amid worries about the effect of the shutdown on the U.S. economy and weak Chinese manufacturing data released Monday. The November crude contract on the New York Mercantile Exchange lost 24 cents to US$102.09.

Metal prices were lower with December copper five cents lower at US$3.28 a pound while December gold faded $12.50 to US$1,314.50 an ounce.

On the economic front, traders looked to the latest reading on U.S. manufacturing. The Institute for Supply Management’s index is expected to indicate slowing expansion, dipping to 55 from 55.7 in August.\