The Canadian dollar is heading lower again today, thanks in large part to the fact oil prices are once again falling. However, while the loonie is likely to retain some of its ties to oil, some analysts are starting to question how long it will remain a true petro-currency.
After a short period of gains, oil prices are once again heading lower. Today, oil prices dropped below $27 per barrel. This news is dragging the Canadian dollar lower. The loonie depends heavily on oil to help with its economic activity, and when oil drops, so does the Canadian dollar.
However, there is some speculation that the loonie may move beyond being a petro-currency in the future. While analysts agree that oil will probably be a major player in Canada’s economy, some believe that the loonie is moving away from being a true petro-currency as the economic landscape changes.
For now, though, when oil drops the Canadian dollar struggles and that has an impact on the economy as well as the currency.
At 14:34 GMT USD/CAD is higher, gaining to 1.3969 from the open at 1.3933. EUR/CAD is up to 1.5860 from the open at 1.5736. GBP/CAD is lower, dropping to 2.0191 from the open at 2.0248
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