Canadian dollar rises, risk aversion eases in Russia/Ukraine standoff

TORONTO – The Canadian dollar advanced Tuesday morning as risk appetite improved somewhat amid an easing of tensions in the conflict between Ukraine and Russia.

The loonie gained 0.12 of a cent to 90.34 cents US.

Russian troops invaded the Crimean peninsula in eastern Ukraine over the weekend, where Russia has major military installations and much of the population is Russian-speaking. Although tensions are still high, they were ratcheted down somewhat after Russian president Vladimir Putin ordered tens of thousands of Russian troops participating in military exercises near Ukraine’s border to return to their bases.

Putin also said he hopes that Russia won’t need to use force in eastern Ukraine. The Kremlin, which does not recognize the new Ukrainian leadership, insists it made the move into Crimea order to protect Russian installations in Ukraine and its citizens living there.

Oil and gold gave back a big chunk of the gains racked up on Monday with the April crude contract in New York down $1.28 to US$103.64 a barrel.

April bullion fell $17.20 to US$1,333.10 an ounce while May copper gained one cent to US$3.19 cents after slipping two cents Monday

The major event for the loonie this week is the Bank of Canada’s latest interest rate announcement on Wednesday. The bank is widely expected to hold off on raising its key rate from one per cent until early next year.

February employment data for Canada and the U.S. will be released on Friday. Canadian job growth is expected at around 19,000 jobs.

U.S. employment gains are expected to come in around 150,000 with results impacted by severe winter weather for a second month in a row.