The Canadian dollar slightly rose Tuesday against the U.S. dollar after finance ministers from euro zone nations agreed on an aid package for Spain and its troubled financial institutions, according to Reuters.
Despite China noting a sharp reduction in the pace of economic growth and development, the ministers' agreement helped benefit the Canadian dollar. Spain was granted through 2014 to reach deficit reduction targets and bailout aid for the nation's banks was adapted.
"European peripheral spreads have pulled back and equities are rallying a little bit," director of foreign exchange sales Matt Perrier with BMO Capital Markets told the news service. "It feels like the risk aversion in the last few days was getting a little bit tired."
But concerns remained strong for ministers' capacities to control the sovereign debt crisis and the damages it is causing, which also impacts investor and traders' views of the allure of risky assets like the loonie.
Bloomberg reports the Canadian housing agency indicated housing starts surprisingly rose in June, which also proved to be beneficial to the Canadian dollar.
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