The Canadian Press

The Canadian dollar hit a seven-week high against its American counterpart Monday as oil prices continued to rise amid signs of global economic improvement.

The loonie closed up 0.27 cents at US97.31 cents, a level it has not seen since hitting a closing high for the year of US97.71 cents on Jan. 14.

The loonie’s year-to-date closing low was of 93.07 on Feb. 8.

A world economy that shows signs of being on the mend has been cited as a big driver of strength in the Canadian dollar, because it suggests increased demand for the commodities Canada produces.

More demand for oil, metals and other Canadian resources generally leads to a rising loonie.

But a higher dollar is also a big problem for Canada’s already hard-hit manufacturers and exporters, They often see falling sales when the cost of their goods increases along with the value of the currency.

Scotia Capital currency strategists have predicted that the dollar will reach and surpass parity with the U.S. dollar by the middle of the year.