Canadian Dollar Fall vs. Greenback to Three-Week Low

The Canadian dollar fell versus the greenback today to the lowest level since July 22nd after the Federal Reserve suggested that the US economy would grow with slower pace, reducing the appeal of the growth-linked currencies. The Canadian currency managed to outperform the euro.

The Standard & Poor’s 500 Index dropped 1.5 percent. Crude oil, Canada’s key export, fell 1.2 percent to $79.32 per barrel in New York. The Fed said yesterday that the US economic recovery would be “more modest”.

The markets still feel the impact of the yesterday’s Fed dovish statement. This are the bad times for the currencies tied to the economic growth. The loonie was particularly hit by the pessimism as Canada’s own economy showed the signs of the weakness previously.

USD/CAD jumped to 1.0446 from 1.0308 today as of 16:32 GMT after rising as high as 1.0473. EUR/CAD dropped from 1.3580 to about 1.3483.

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