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The Canadian dollar advanced to within one cent of parity with its U.S. counterpart as signs of global economic recovery boosted stocks, commodities and currencies tied to growth.

The loonie, as Canada’s currency is nicknamed, touched C$1.0068 yesterday, its strongest level in almost two weeks. Canada’s dollar strengthened against 11 of its 16 major counterparts over the previous four days as a report on March 31 showed the nation’s economy grew in January at the fastest pace in three years.

“Commodity prices reflect stronger global growth and dulls demand for the U.S. dollar,” said Andrew Wilkinson, senior market analyst at Interactive Brokers Group Inc. in Greenwich, Connecticut. “Parity is imminent. It’s very, very difficult to argue against the global economic rebound.”

The loonie gained 1.7 percent to C$1.0095 versus the greenback this week from C$1.0266 on March 26, its biggest gain since the five days ended March 5. One Canadian dollar buys 99.15 U.S. cents. Canadian markets are closed today for the Good Friday holiday.

The Standard & Poor’s 500 Index rose for a fifth straight week, closing yesterday at its highest level since September 2008. Crude oil for May delivery rose 6.5 percent on the New York Mercantile Exchange. Crude oil is Canada’s biggest export.

The Canadian dollar tends to track movements in stocks and commodities. The loonie’s 120-day correlation with crude is 0.61 and 0.67 with the S&P 500. A reading of 1 would indicate they move in lockstep.

Manufacturing Data

Crude oil yesterday gained as much as 1.7 percent to a 17- month high of $85.22 a barrel after economic data from the world’s three largest economies reinforced confidence in the global economic rebound. U.S. manufacturing expanded last month at the fastest pace since July 2004, China’s manufacturing grew for a 13th month and a Bank of Japan survey showed confidence among the nation’s largest manufacturers rose for a fourth straight quarter.

“The tone of data releases were all better-than- expected,” said Jack Spitz, managing director of foreign exchange at National Bank of Canada in Toronto. “Equities and commodities are posting gains. Unsurprisingly, the Canadian dollar as a risk-correlated currency is doing well.”

The Canadian dollar reached C$1.0062 on March 19, the strongest level since July 23, 2008, on speculation the nation’s accelerating economic recovery will spur the Bank of Canada to raise interest rates before the U.S. Federal Reserve.

Gross domestic product increased 0.6 percent in January, the fifth straight gain and the biggest since December 2006, Statistics Canada said this week. Economists surveyed by Bloomberg News had predicted the economy would expand 0.5 percent in the first month of 2010, according to the median of 20 estimates.

Positive Data

“There’s just so much positive economic data coming out of Canada that there hasn’t been anything to shake that sentiment,” said Sacha Tihanyi, a currency strategist in Toronto at Bank of Nova Scotia, Canada’s third-largest bank.

Bank of Canada Governor Mark Carney signaled on March 24 the central bank may raise interest rates as soon as June as inflation and growth outpace forecasts.

“I don’t see any reason why they couldn’t pull the trigger ahead of us,” said Daniel Janis, a money manager in Boston at MFC Global Investment Management, referring to the Bank of Canada and the U.S. Fed in an interview this week. “Within the next six months, there’s going to be an inflection point on rates.”

Government bonds were little changed on the week. The yield on the 10-year security traded at 3.56 percent. The 3.75 percent security maturing in June 2019 rose one cent to C$101.51.