CAD Drops as Poor Market Sentiment Slashes Appeal of Risky Assets
The Canadian dollar fell against its US peer today as negative Forex market sentiment damped demand for riskier assets. The currency managed to rise versus the euro and, surprisingly, to stay flat against the Japanese yen.
Fears about the possible collapse of the eurozone rule the Forex market even as Greece is not going to leave the currency union, at least for now. The Group of Twenty started a meeting today to discuss the problems of Europe, but there is not much belief in positive outcome of such discussions. Investors have seen such meeting before and all of them were futile to a large degree.
Crude oil prices dropped today as negative market sentiment made traders flee risky assets. Crude is the major export good of Canada, which is the largest supplier of oil to the United States. On top of that, economists predict that economic indicators this week would signal about slowdown of Canada’s economy.
USD/CAD advanced from 1.0204 to 1.0237 as of 21:17 GMT today, while its daily maximum was at 1.0277. EUR/CAD dropped from 1.2594 to 1.2873, following a rally to 1.3005 — the highest level since June 4. CAD/JPY was at 77.23, near its opening rate of 77.14.
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Earlier News About the Canadian Dollar:
- Canadian Dollar Pulls Back on Global Economic Concerns (2012-06-15)
- Poor US Fundamentals Sap Strength of Loonie (2012-06-13)
- Canadian Dollar Falls Back as Risk Appetite Fades (2012-06-11)
- Loonie Suffers from Poor Canadian Employment Data, Recovers (2012-06-08)
- Loonie Advances as Bank of Canada Suggests Interest Rate Hike (2012-06-05)