Updated: Fri, 11 Jan 2013 14:21:19 GMT | By David Friend, The Canadian Press, thecanadianpress.com

Loonie up slightly as trade deficit spikes

TORONTO - The Canadian dollar was higher Friday after new data showed the country's trade deficit with the world jumped in November.

The loonie rose 0.01 of a cent to 101.58 cents U.S.

A report from Statistics Canada said the country's trade deficit with the world ballooned to $2 billion in November from $552 million in October as merchandise imports rose 2.7 per cent and exports fell 0.9 per cent.

"It looks like trade will take another bite out of already weak economic growth," said Sal Guatieri, senior economist at BMO Capital Markets in a note.

"Total exports are now 6.3 per cent below year-ago levels, the worst performance in three years, while imports are flat."

In commodities, oil prices fell after China's inflation rose to levels that could affect the country's growth. February crude was down 26 cents to US$93.56 a barrel on the New York Mercantile Exchange.

European countries are also facing their own uphill battle to restore economic growth. The economies of the 17 European Union countries that use the euro are in recession and unemployment is soaring across the region.

Gold prices backtracked with the February contract down $17.40 to US$1,660.60 an ounce.

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