The Canadian dollar continued to trade higher against the U.S. dollar in mid-morning trading on Thursday.

Recent fundamental data suggesting the Canadian economy is under inflationary pressure continued to prop the loonie today. On the heels of yesterday's CPI report, today's retail sales report reinforced the position that the Canadian economy may not be in as bad as shape as thought. Retail sales increased 0.1 per cent for the month of March, with sales in the automotive sector posting a gain of 0.4 per cent, the fifth increase in six months. According to the new motor vehicle sales survey, the number of new motor vehicles sold in the first quarter of 2008 rose by 9.1 per cent. The gain could be attributed to U.S. pricing, which was introduced by many car dealers in the first month of this year.

South of the border, unemployment claims fell last week with an estimated 365,000 workers applying for first-time benefits. The U.S. housing sector continued to suffer in the first quarter of 2008 as housing prices fell by 1.7 per cent from the last quarter of 2007, representing the largest price decline on record.

Oil traded close to a record high of US$133.17 in New York on Wednesday and continued to advance on Thursday, reaching US$133.78 by 10 a.m.

By 10:30 a.m. Thursday the Canadian dollar was trading at 1.0153, against the U.S. dollar.

Market report prepared by Bruce Hauser

Accu-Rate Corp.

2573 Carling Ave. Ottawa, ON K2B 7H7

Tel: (613) 596-5505

E-mail: bruce@accu-rate.ca