Loonie Suffers as Europe Hurts Market Sentiment
The Canadian dollar fell today as the Forex market was not pleased by the news from Europe and entered a risk-off mode. The Canadian currency remained weak against safer currencies and even declined versus the euro.
Optimism about Europe waned completely as there are no signs that politicians make headway in battling the crisis. Spanish Prime Minister Mariano Rajoy delayed request for a bailout even as nation’s unemployment rose to the record. There are talks that Greece will not meet spending cuts target demanded by the European Union and it is not hard to believe in such speculations.
Uncertainty about the Bank of Canada’s future monetary policy added to the pressure on the loonie. Bank’s Governor Mark Carney thinks that an interest rate hike may be delayed even as the central bank claims that higher rates may be prudent.
USD/CAD rose from 0.9946 to close at 0.9978 and EUR/CAD climbed from 1.2864 to the closing price of 1.2906. CAD/JPY fell from 80.67 to 79.74, the lowest close since October 11.
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Earlier News About the Canadian Dollar:
- Loonie Gains on Expectations of Higher Interest Rates (2012-10-25)
- Bank of Canada Remains Hawkish, Loonie Goes Higher (2012-10-23)
- Loonie Struggles against other Majors (2012-10-22)
- Loonie Declines to Lowest in Several Months on Poor CPI Growth (2012-10-19)
- Canadian Dollar Hurt by Flaherty's Comments (2012-10-19)