The Canadian dollar surged to a new 30-year high against its US counterpart, boosted by strong oil prices and broad US dollar weakness. Yesterday, US Nymex crude oil prices reached a new record high of over 80 usd per barrel. Although prices have dropped back slightly today they remain very strong. The Canadian dollar is typically highly sensitive to movements in the oil price, though it has also benefited from broad weakness in the US dollar, which has hit new all-time lows against the euro on the back of expectations for a US interest rate cut next week. This "bullish market news (on oil prices)" for the Canadian dollar has been supported after Bank of Canada governor David Dodge yesterday stressed the health of the Canadian economy, BNP Paribas analysts said. Speaking in London, Dodge reiterated that the Canadian economy is operating above potential, though he said tighter credit conditions should temper domestic demand. "All things equal, the comments imply reluctance to cut rates following recent market volatility," the BNP Paribas analysts said.