Fueled by US dollar weakness and better oil prices, the loonie headed higher yesterday. Today, though, the Canadian dollar is down again, heading lower against the greenback and its other major counterparts.
Yesterday, as the greenback’s weakness became the story on the back of falling North American stocks and disappointing economic data, the Canadian dollar got a bit of a boost. Most of those gains are being erased today as the greenback reasserts itself, and as oil prices head lower.
Over the last couple of days, oil has been showing signs of life. However, today oil prices have dropped more than a dollar and are back below the $60 a barrel mark. The Canadian economy relies heavily on oil for support, and when oil prices struggling, the loonie often struggles as well.
Even with recent upbeat statements from Stephen Poloz, the head of the Bank of Canada, there isn’t a lot to support the loonie right now. As a result, it’s not much of a surprise that the Canadian dollar continues to drop against its major counterparts — and move further from parity with the US dollar.
At 11:13 GMT USD/CAD is up to 1.2448 from the open at 1.2402. EUR/CAD is up to 1.3839 from the open at 1.3828. GBP/CAD is up to 1.9028 from the open at 1.9027.
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