Loonie hits 4-week high as oil continues recent climb

The Canadian dollar touched a four-week high against the American dollar on Friday as oil prices extended their recent rebound and weak U.S. retail figures pressured the greenback. 

The loonie gained more than a tenth of a cent to close at 77.15 cents US. Earlier in the session, it touched 77.37 cents US. That's its highest level since July 15.

• U.S. retail sales unexpectedly flat in July
• Oil prices to hover around $50 this year, touch $60 by 2017, say energy analysts

Oil futures jumped a dollar to settle at $44.49 US a barrel in New York trading over the noon hour. There's speculation that OPEC oil producers could take some action at next month's informal meeting in Algiers to prop up the market.

Oil is on track to record its best week since April, according to Bloomberg data, with prices up better than six per cent.

Energy stocks rise

The energy sector was the only group to end the day higher in Toronto Stock Exchange trading.

Most North American markets, including the TSX, finished lower Friday, one day after all major U.S. stock benchmarks hit record highs.

The Nasdaq was the lone winner, as it eked out a small gain to close at a new all-time high.

The Canadian dollar is viewed as a commodity currency by many foreign exchange traders because the country is such a big exporter of oil. So big gains in oil prices often lead to jumps in the value of the loonie.

The U.S. greenback found itself being hobbled by July U.S. retail sales that were unexpectedly flat. That was reinforcing the view that the Federal Reserve will not be in any rush to raise interest rates.  

"The [U.S. dollar] has not been able to take advantage of [last Friday's] stronger than expected job gains and has weakened broadly this week," noted Scotiabank chief foreign exchange strategist Shaun Osborne in a Friday morning commentary.