The Canadian dollar slumped as the meeting of the European Union leaders hasn’t provided an answer to the problem of the European countries’ debts and after Ireland’s credit rating was downgraded.
The Moodyâs Investors Service downgraded Irelandâs credit rating from Aa2 to Baa1 today as the country has asked for the aid last month. The downgrade refueled the fears about the possible spreading of the debt troubles to other peripheral European economies and the EU official weren’t able to provided clear answer to these concerns. Such environment of uncertainty is good for the safer currencies and bad to the
The loonie, as the Canadian currency is often nickname, also weakened on the speculation that the central bank would sell the currency as the strong currency prevent the bank to raise the interest rates. Yet, the probability of the intervention is lower now as the Canadian dollar already weakened.
USD/CAD closed at 1.0127, jumping for the opening price of 1.0061. EUR/CAD closed 1.3350 after it opened at 1.3326 and reached the intraday high of 1.3444.
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