The Canadian dollar rallied as the gains of stocks triggered a rally of crude oil. The currency weakened a bit at the start of today’s trading, but does a good job of holding its gains so far.
Crude oil rose 1.6 percent to $95.96 per barrel in New York trading and reached $96.11 — the highest level since August 1. Performance of crude has a great impact on Canada’s economy and currency as oil is the main nation’s export. The Standard & Poorâs 500 Index gained 0.6 percent. The S&P/TSX Composite Index advanced 0.4 percent.
There are enough reasons for the loonie to fall, though, and it’s not surprising that the currency’s rally has stalled. The debt crisis in Europe is the main negative factor for Canada’s dollar. Juergen Stark, member of the European Central Bank Executive Board, said that the crisis will be under control in two years, but such claims usually don’t resonate in minds of traders, who have heard many such promises before.
USD/CAD traded at 1.0135 today as of 2:52 GMT after falling yesterday from 1.0166 to 1.0124. EUR/CAD was at 1.3949 today after yesterday’s drop from 1.4054 to 1.3948. CAD/JPY traded near 76.94, following the advance from 76.84 to 77.04 on the previous trading session.
If you have any questions, comments or opinions regarding the Canadian Dollar,
feel free to post them using the commentary form below.